In the ancient painting “The Vinegar Tasters,” three old sages, representing Confucianism, Buddhism and Taoism, the three pillars of Chinese religion, encircle a vat of vinegar and, having dipped respective fingers first into the brew and then to their lips, register their reactions — and thereby their philosophical outlooks — in their expressions. While the Confucian and Buddhist sages grimace, finding the brew respectively sour and bitter, the Taoist only smiles contentedly, confirming his outlook that all is as it should be.
The allegory perseveres in this ‘sky is falling’ age of economic uncertainty, even as the players are shuffled a bit. In the contemporary tableau we might imagine the vat labeled ‘the economy,’ and sampling it are government, big business and small business. While government and big business grimace like their Confucian and Buddhist progenitors, small business beams, finding opportunity in even the bitterest brew.
For years, we’ve heard that the Chinese word for ‘crisis’ is a combination of ‘danger’ and ‘opportunity’ — and while that notion has been largely debunked, it remains true that in this particular crisis, businesses both large and small face an abundance of both. Even the rosiest outlook would have to concede that times are dire, in any sector of the economy. With the markets in meltdown, credit in lockdown, consumer spending in precipitous decline, unemployment climbing and anyone with the ability to do so running for cover, it seems the one thing upon which everyone agrees is that it’s the worst time since the age of FDR.
And yet the patient is far from dead; though one might have to focus to find them, the signs of life are clear: consumers still spend as they must, demand for food, fuel, raw materials, consumer goods and services and the innumerable other pixels that collectively comprise what we know as the economy remains unequivocal. While in one aspect or another we might be experiencing a relative hiatus — as with banks’ current lending practices — such can be likened to the holding of one’s breath; sooner or later, respiration must resume, for dependent upon it is no less than the body’s very survival.
It’s for this, among many other reasons, that small businesses in Ventura County and across the nation have reason to smile; for while big business must plod along, sturdy and slow, small business has the agility to dart, to change direction according to emerging trends and patterns. The difference is as between a lumbering fullback, plunging into the line in tried-and-true smash-mouth style, and a nimble tailback, darting into the narrow gaps, changing direction, breaking the game wide open.
The simile could prove altogether apt, as many pundits and experts believe it will be the influence of small business and its attendant entrepreneurial ethic that will, sooner or later, elevate the turgid economy from its doldrums and get it back on track.
“As we work to fix our ailing economy, we must not forget that our prosperity begins with Main Street entrepreneurs in communities across the country,” notes Nydia Velázquez, chairwoman of the House of Representatives’ Committee on Small Business. “If we are going to bring our economy back on track,” she warns, “we’re going to need to promote innovation and job creation for our nation’s small businesses.”
It’s with that ethic in mind that small business advocates, like the National Federation of Independent Business, are arguing that a meaningful portion of the Fed’s economic stimulus package should be earmarked for the support of small business, noting, among other facts, that fully half of the country’s jobs occur on small business payrolls. By the same token, they argue that small business would benefit from not merely direct funding, but a more careful oversight of the billions already committed in the effort.
As Todd McCracken, president of the National Small Business Association states, “We think that as the federal government is shoveling out huge sums of money to shore up the banks, they need to make sure those banks are making loans where they’re most needed — putting the money back out the door to small businesses and consumers.”
The ability of small businesses to adapt and change could prove more than just a game-breaker; such may ultimately comprise a veritable survival skill, as trends suggest that many large, deeply entrenched firms that can’t affect such dynamism may not last the year.
The recent bankruptcy of Circuit City, after failing to refinance its debt, may be — according to Dianne Vazza, Standard & Poor’s expert on corporate debt markets — only the first of an oncoming wave of big business bankruptcies. With interest rates climbing, firms with less than stellar credit may soon find themselves fatally trapped with operations dependent on loans they can no longer afford. “Any firm in America that doesn’t have an investment-grade credit rating could be vulnerable,” Vazza notes, “and that includes such established names as Eddie Bauer, Krispy Kreme, Rite Aid, Six Flags and many more.”
Alecia Caine, who serves small businesses in Ventura County as a financial consultant and business sustainability expert advises, “Business that depends on credit can ultimately prove unsustainable; it’s often a practice that results from unrestrained growth. While growth is, of course, desirable, long-term slow growth is most advisable, though the temptation to grow as fast as possible can be difficult to resist.”
Caine is one of many professionals to whom small business owners turn for support in the oversight of their trade — tribute to the inescapable fact that running a small business is no easy matter, and that business owners frequently must endure a wilder ride than they could possibly have imagined.
“While the failure rates of new businesses are widely known,” explains Gina Gippner-Woods — Justmom Inc. of Thousand Oaks, provides comfort toys to children with life-threatening illnesses — “what is less well-known is that 65 percent of businesses that go under are actually making a profit at the time they close.”
“Running a business is an act of passion,” Caine explains. “Business owners have to be two very different people, both the passionate visionary and the sensible steward.” While it’s easy to imagine the freedom and presumed riches that come along with business ownership, few are prepared for the commitment and dedication the venture demands, nor for the next-to impossible need that the proprietor ‘know everything’ from square one.
Thea Shoemaker (also a fitness columnist for the VCReporter) counted on her years of success as a personal trainer to guide the way last year, when she opened a fitness studio in Oxnard. She laughs ruefully as she recalls, “If I knew then what I know now …. I earned the equivalent of a Master’s Degree in Business Administration — from the School of Hard Knocks!”
After closing the studio late last year in the wake of a crashing economy, she has since applied her lessons to inestimable benefit in the Silver Strand Surf School, a highly successful venture she now runs in partnership with her husband.
“One of the most powerful lessons I learned,” she explains, “was that I had no way of knowing what I didn’t know — my blind spots were exactly that. Now I make sure I regularly consult experts to keep me in good balance. While many business owners seem to think that’s too expensive, as far as I’m concerned it’s a bargain compared to the cost of learning the hard way, after your business has closed.”
Shoemaker has plenty of company among entrepreneurs who have risen from the flames of past ventures to thrive. “I learned a spin on the old adage,” notes Daryl Wizelman, who employed over 500 people before the economic tsunami claimed his United Pacific Mortgage of Woodland Hills. “I now say, ‘whatever doesn’t kill you makes you smarter.’ ” Like Shoemaker, Wizelman has applied his hard-won lessons with success in new ventures, as a motivational speaker and with an auto brokering business. He likewise sees nearly unlimited promise in the power of the entrepreneurial spirit.
“I’ll bet on the power and promise of small business over the Fortune 500 any day,” he confides. “They’re more in touch with their businesses, with their customer base and with their profit and loss statements — they have to be.”
“I believe our economy will find its feet again because of small business and entrepreneurship,” Caine agrees, even as she works directly to support that ethic, as controller of the Gold Coast nonprofit Women’s Economic Ventures (WEV, www.wevonline.org), which offers self-employment training and mentoring along with small business loans to entrepreneurs of both genders.
“Focus and clarity are so important — both in planning and in execution,” notes Tea Silvestri, who serves both as a WEV instructor and as a consultant in green business and sustainability. “We teach our clients to be authentic, committed and passionate. At the same time, they learn to be highly disciplined, developing careful, methodical business plans.”
Longtime business owner and consultant Roger Bowman applies a similar approach, noting, “Quite frankly, many people arrive in the market as opportunists who get in while the market is rich, but have no idea what to do when things get tough. I counsel my clients to take careful stock, to ask, ‘Who are we? What is our product, and what is its value? Is our business valid? What are our values? Do we even belong in this market?’ It’s only when all those answers add up that it makes sense to then ask, ‘What do we do next?’ ” Bowman points to times like these as a natural weeding out process in the market, when many businesses and business people find their focus refined, and possibly thereby find themselves in a position to take advantage of new opportunities.
“It’s the hallmark of the entrepreneurial spirit,” notes Silvestri, “that, when faced with adversity, entrepreneurs don’t just lie down and die — they adapt and change, they identify needs and move to fill them.” Clearly, theirs is a spirit that is deeply celebrated in the culture of American business, and with that celebration come abundant resources to help with the heavy lifting.
Along with non-profits like WEV, entrepreneurs can find help from programs like Ventura College’s Small Business Development Center (SBDC), from the local chapter of SCORE — a division of the U.S. Small Business Administration — and in a new development for high-tech startups, through the Ventura Ventures Technology Center (aka the Ventura Incubator), which offers low-cost office infrastructure and a collaborative round table office ethic in a campus-style setting that aims to spin off new tech firms into ongoing Ventura residency.
“We’re working to create an entrepreneurial ecosystem,” notes Alex Schneider, the Incubator’s Executive Director. The facility’s 10,000 square feet is meant to host numerous embryonic companies in a two- to four-year residency that promises to be a win-win for both the firms and the business community at large.
While the pundits and news agencies assure us that the outlook is dire and that the sky may in fact be falling, the entrepreneurs once again roll up their sleeves and get back to work — smiling all the while, despite the irrelevant flavor of the vinegar. Coincidentally, Jan. 26 marks the Chinese New Year — the commencement of the year of the Ox, known for prosperity gained through fortitude and hard work. Those born under the noble Ox are known as natural leaders, dependable and tenacious.
Regardless of the verisimilitude of the Chinese Zodiac, the omen is most welcome, for there remains much work to do and a vast hill to climb between yesterday’s catastrophe and tomorrow’s prosperity.
Likewise, regardless of doomsayer scenarios, the engine of small business — the ‘engine that could,’ if ever there was one — troubles little with doubt. Possessed of unshakable belief in the time-honored mantra “I think I can,” and armed with the indomitable will of the truly inspired, it pulls us all along with it, remaking an economy and making believers of the entire world along the way.