Businesses' Options: Stay or Go ; Katrina May Knock Small Firms - Especially Minority-Owned Ones - out of Business

Article excerpt

The fate of Wet Dog Glass hangs in the balance.

The roof is off the studio that housed the glass-blowing equipment. Owners Angela Bernard and her husband knew that right away from aerial pictures of New Orleans posted online.

"With something like this, you have to make the decision whether you want to go on," said Ms. Bernard, who had not yet been back to the city.

To rebuild or relocate is a dilemma facing many small-business owners along the hurricane-damaged Gulf Coast. It's an especially difficult choice for the Bernards and other minority entrepreneurs.

Their businesses, concentrated in the service and retail industries, were hit disproportionately hard, and community leaders worry their loss could threaten minority employment and unravel the social fabric of neighborhoods in the Gulf.

Unlike larger corporations, some of which have already relocated to temporary headquarters in Baton Rouge, La., or Houston, many small-business owners depend on community contact with their customers. Many have lost not only their shops, but also their client base, employees, and any hope of a quick return to normal business.

"The neighbors are gone. The route you walked to the grocery store is gone," Bernard says.

In largely African-American east Biloxi, many businesses had closed their doors long before Katrina, driven out by gangs and drugs. But community leaders say those that stuck it out - like Inez's Lounge & Cafe, or Tyrone's Barber & Beauty Shop - anchored the community and gave hope that east Biloxi could join in the revitalization taking place in other cities.

Now, in Katrina's aftermath, some entrepreneurs here are considering closing, or relocating to other cities. Either choice would set back a region trying to rebuild.

"I never thought I'd be in this shape," says Inez Thomas, who has cooked soul food in the same location for 17 years and calls her customers family. The water rose to the 11th step of her cafe's staircase; in one day she lost her business, her home, and her car. …