Minority Women-Owned Firms Experience Record Growth
Gwen's Old-Fashioned Bread Puddin' Crunch is a Chicago-based gourmet dessert company founded a year and a half ago by Gwendolyn Meeks, a 41-year old African American woman. Spurred by her desire to "get off the plantation," as Meeks calls working for someone else, she always dreamed of economic independence.
The idea for Meeks' business actually came to her in a dream. Shortly after Meeks' mother died in 1999, she dreamt her mother had asked her to go into the kitchen and make her some bread pudding, one of her mother's favorite desserts. "I really didn't want to at the time," Meeks recalled. "And she said, 'Girl, stop being so lazy. Get your behind up and make me some bread pudding.'"
Though she went back to sleep that night, the next day, Meeks had an overwhelming craving for pineapple bread pudding--a recipe she'd never tried before or tasted since. A friend stopped by the next day, sampled some of Meeks' dream-inspired bread pudding and encouraged her to try to sell it.
Meeks began taking her bread pudding around Chicago, gaining encouragement from all tasters. One day, she asked the manager of the cafÃ© at a Borders bookstore if they might be interested in selling her bread pudding. To her surprise, the manager was very interested and asked Meeks if she baked in a health department certified kitchen, had a business license, insurance, etc. "I felt like Dorothy after the Wizard of Oz gives her that list and says, 'OK, now I want you to go get the broomstick from the Wicked Witch of the West,'" says Meeks. "I didn't know how I was going to do it, but I knew I had to do it."
Meeks enrolled in a 12-week business-training course at the Women's Business Development Center in Chicago. By the end of the 12 weeks, Meeks had most everything she needed to start selling her bread pudding. Paperwork in hand, she went back to the Borders cafÃ©, where they soon began selling her bread puddings made with a crunchy topping, available plain or with raisins.
"I saw they were selling my bread pudding for $5 a slice, and I thought, 'Well, I really have got something here,'" says Meeks, who now sells her products in selected Jewel grocery stores, a major Chicago chain. So far, Meeks still does all the cooking (in a rented, certified kitchen) and runs her company while holding down a full-time job as a social work administrator. She estimates that she spends about 40 hours a week building her business.
Meeks is not alone in her quest for entrepreneurial success. U.S. women of color are starting businesses at a faster rate than other women and all other business owners, according to a study released last month by the Center for Women's Business Research (formerly the National Foundation for Women Business Owners). This incredible growth among minority women-owned firms, at 31.5 percent, was more than four and a half times greater than the growth rate of all firms nationally, at 6.8 percent.
"What's exciting about this," says Nina McLemore, vice chair of the CWBR and president of Regent Capital Partners in New York, "is that finally, we're finding statistics that women-owned businesses are not all small. These increases mean an exponential growth in power for women and for minority-owned businesses."
McLemore said she and other women business leaders are excited about the "role model effect." "We look at a successful woman and think, 'If she can do that, and overcome all that she has had to overcome, then just think of what I can do.'"
Perhaps because women tend to be more open about asking for help, Meeks attributes much of her success to the support she's received from the WBDC and the law clinic at the University of Chicago, which provides free or low-cost help to business owners. Like many entrepreneurs, Meeks has financed the growth of her company using the salary from her full-time job along with some financial help from her father, fiancÃ© and friends.
Leticia Herrera, another successful minority woman entrepreneur, owns and operates ECI, a thriving Chicago-based company that specializes in metal and stone restoration and construction management. Successful today, the outlook was far from rosy in 1995 when her company was near bankruptcy.
When ECI started 10 years ago, it was just Herrera, her mother and her aunt, performing standard janitorial services. The letters stood for "Extra Clean Inc." Their reputation for doing good work was solid, and the company grew quickly, although as a labor-intensive business, profit margins were always thin. When people began stealing from the company, it pushed ECI over the edge.
In 1995, Herrera said the company was $300,000 in debt. She had only $65,000 in hand when her attorneys recommended she file for Chapter 11 bankruptcy protection. Herrera had another idea. She met personally with her creditors, arranging terms to pay back as much of the debts as she could and asking her creditors to forgive the rest. Forty-eight hours later, she had saved the company. "I took a leap of faith," says Herrera. "I could go bankrupt, or choose to do it my way. It was not an option to do it the easy way. I didn't run; I didn't hide. I went through it."
After her brush with bankruptcy, Herrera kept the letters but re-named the company Excellence Consistency Integrity, a concise mission statement for her revived company. The first thing she did was stop providing janitorial services, since the margins were too small. As Herrera puts it, with 1 to 3 percent margins, "you sneeze the wrong way and you're out." She moved into specialty cleaning, focusing on stone and metal restoration.
Herrera applied to become a certified woman-owned and minority-owned business to give her an advantage as she expanded into construction management. (Government contracts often stipulate that a certain percentage be completed by a minority-owned or woman-owned firm). Construction management, where ECI oversees a group of smaller subcontractors on big projects, now makes up roughly 50 percent of ECI's revenue, which is under $5 million annually.
In addition to running her business, Herrera serves as chair of the U.S. Hispanic Chamber of Commerce, the first woman to hold the position. She travels extensively and is involved in many entrepreneurial conferences and activities. Always a hard worker, Herrera has focused on learning to delegate more. "Five or six years ago, I didn't stop to go to the bathroom," says Herrera. "I couldn't remember sleeping." Now her life has more balance. "My business is service," says Herrera. "I'm here to serve, but not to be a servant."
Jane Applegate is a syndicated columnist and the author of 201 Great Ideas for Your Small Business. For a free copy of her "Business Owner's Check Up," send your name and address to Check Up, P.O. Box 768, Pelham NY 10803 or e-mail it to email@example.com. Sarah Prior contributed to this report.