Minority small-business owners in Washington voiced increased optimism about their prospects—even amidst the threat of recession—during the last half of 2007. Minority business owners in the survey cited significant increases in quarterly sales and profits, and 30 percent of businesses surveyed expected to hire new employees within three months.
The source of these findings is the Washington Minority Small Business Survey, prepared by the Michael G. Foster School of Business at the University of Washington. The research was led by professors William Bradford, Vandra Huber and Richard Yalch, affiliated with the Foster School’s Business and Economic Development Center.
For the first time, the survey includes responses from Caucasian-owned businesses to compare more accurately differences in small-business priorities. The survey results demonstrate the need to examine minority-owned small businesses as a unique sector, according to the survey’s authors. For example, while Caucasian small-business owners were most concerned about taxes, inflation and government red tape, minority small-business owners cited financing gaps and competition from big businesses as their biggest challenges. Minority small business owners voiced guarded optimism around growth despite the perennial challenge of perennial challenge of securing capital investment.
“Overall, minority-owned small businesses are opening at a faster rate and citing a more supportive business climate than Caucasian-owned businesses,” said Bradford, professor of finance and economics. “Whether I’m an investor, a job seeker or a policy wonk, this is information I want to have at my fingertips.”
The survey contains two indicators: the Recent Performance Index, and the Minority Small Business Confidence Index. The former increased significantly in 2007, from 57 to 62 on a 100-point scale from the first quarter to the third quarter of last year. The latter, which helps forecast owners’ perceptions of the near future, rose two points on the same scale from 57 to 59.
These data match the day-to-day experience of Craig Dawson, president of Retail Lockbox, a minority-owned company specializing in remittance processing, document imaging, and online payment processing.
“Not only is this data useful to me as a business owner, it’s also an important benchmark for minority-owned small businesses,” said Dawson. “The survey is very well designed and I’m excited about the increased visibility it brings to a growing business sector.”
The survey asked 477 randomly selected minority small-business owners from across the state to describe their confidence levels and expectations about future industry trends. Minority-owned businesses are defined as companies in which majority ownership is Asian, black or Hispanic. Owners from multiple service sectors, including construction, government, finance, retail and transportation, participated in the survey.
Funded by grants from the University of Washington’s Diversity Research Institute, the Office of Minority Affairs and Diversity and the Foster School of Business, the survey is a semi-annual report and the only survey of its type in Washington.
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For more information, contact Bradford at (206) 543-4559 or cell (206) 585-5077 or mailto:bradford@u.washington.edu.
A complete copy of the report can be found at http://foster.washington.edu/bedc/msbs-feb08.pdf