Academic journal article Journal of Business and Entrepreneurship

A Hispanic Business Center: Development and Success Criteria

Academic journal article Journal of Business and Entrepreneurship

A Hispanic Business Center: Development and Success Criteria

Article excerpt

ABSTRACT

A university outreach program, the Hispanic Business Center, was assessed by data collected from 74 class participants. This longitudinal study examined entrepreneurial characteristics, information and assistance needs, and strengths and weakness of the center. Respondents enrolled at the center to receive assistance in several areas, such as startup, legal, and financial assistance. It was imperative to have a high level of service as well as a bilingual director who understands the Hispanic culture. Owners perceived the assistance and training to be beneficial, with the exceptions of a lack of computer facilities and more time needed with faculty and staff. The majority of the participants stated that if further assistance were needed, owners would return to the center. Results could be of interest to other universities seeking such an outreach program.

INTRODUCTION

The increased interest in entrepreneurship demonstrated by institutions of higher education has been seen in outreach programs to provide information and assistance to the small business sector. Research has shown that small business assistance programs have generated primary benefits to the clients and may also generate secondary benefits to the economy at large (Wood, 1994). However, research has shown that minority entrepreneurs face greater risks of failure and less chance of success than other entrepreneurs (Dadzie & Cho, 1989).

Many emerging entrepreneurs who are new to the U.S. are Hispanics who wish to start a new business. This large growth in the Hispanic population has had an economic significance due to the expansion of ethnic-owned and operated businesses (Light & Gold, 2000; Tienda & Raijman, 2004), not only because they increase the demand for ethnic goods, but also because Hispanic entrepreneurs have proven to be highly industrious in finding alternative methods of earning a livelihood, including informal self-employment (Tienda & Raijman, 2004).

LITERATURE REVIEW

Growth of Hispanic Businesses

Recent U.S. census data reports that Hispanic-owned small businesses have grown 31% between 1997 and 2002, three times the national average for all businesses according to the Survey of Business Owners: Hispanic-Owned Firms: 2002 (U.S. Census Bureau, 2005). This report shows important highlights related to Hispanic-owned businesses; for example, there were 29,184 Hispanic-owned firms with receipts of $1 million or more and 1,510 Hispanic-owned firms with 100 employees or more, generating more than $42 billion in gross receipts.

According to previous research, Hispanic businesses experienced a 195% increase in revenue, almost three times higher than the rate of increase experienced for all U.S. businesses during 1997 (Shim, 1998). This trend is most likely to continue due to the Hispanic community growth and the immigration rate. Presently, 35.2 million Hispanics reside in the U.S., constituting 12% of the country's total population. Estimates indicate the growth in the Hispanic community will have an impact, since the Hispanic population grew nearly 60% in the last decade and represents the fastest growing segment of the workforce (Trujillo, 2002).

Barriers to Success

Studies have identified a variety of barriers faced by Hispanic entrepreneurs (Jones & Tullous, 2002). Lack of business education, language, training, and experience are barriers to business success. Researchers note that language barriers and agency bureaucracies make it difficult to open a new business (Lofton, 2007). In the case of female owners, Robles (2004) explained that when compared to white and African-American female business owners, Latina entrepreneurs were older, were less educated, and had more dependent children. Latina entrepreneurs also cited family involvement in business activities as an important feature of business ownership. Sarason & Koberg (1994) found that Hispanic female small business owners started the businesses themselves and were usually new to business ownership. …

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