Great Recession? For them, it's a great time to get started

By Franci Richardson Ellement Globe Correspondent
June 21, 2009

SHARON - A professional dream come true presented itself to Miri Park last year when a friend offered to set up an optometry shop with her in downtown Sharon. But the friend backed out suddenly, posing the question of whether it would be prudent to open a business alone in the midst of a recession.

But Park, 47, had a lot going for her. She had been working as an optometrist in town for 12 years and building a clientele. She had become well known in her hometown of 14 years as a volunteer. And not only was she willing to work hard, she also created a backup plan in case of financial trouble. She opened the doors of South East Eye, or SEE, on March 2.

Park, who today is doing double the business she initially projected, is one of a number of new business owners south of Boston who are not allowing the recession to stomp on their dreams. They are part of a large throng of start-up entrepreneurs in Massachusetts who have jumped into the economic fray, despite the long odds of succeeding in a down market.

The US Small Business Administration reports an uptick in start-up loans in Massachusetts from 52 issued in the first three months of this year to 35 loans in April alone. President Obama created the Recovery Act in February, eliminating fees to borrowers and allowing the SBA to guarantee up to 90 percent of each loan. In the first quarter of 2008, 20 percent of the loans approved by the SBA in Massachusetts went to start-ups. But in April, two months after the Recovery Act was created, the percentage of SBA loans here going to start-ups had jumped to 30 percent, according to Elizabeth Moisuk, a public affairs officer for lender relations in the Massachusetts office.

Even with capital available to them, though, new entrepreneurs have a difficult road ahead. Business experts say that people bent on taking on the odds of today's economy need a conservative financial plan that keeps overhead costs low. They need, too, help from their friends and family, and the ability to take advantage of the market downturn and bargain for whatever they can get, be it office space or supplies.

Bentley University management professor Scott Latham said this particular recession is consumer-driven, which means that people are just not buying much outside of necessities. Latham said the best businesses to start up now - with at least another six months to go in this recession - are those that provide cheaper services instead of indulgences.

"If my best friend came to me and said, 'I want to open a restaurant,' I would say this just isn't the time to do it. But if someone said, 'I want to run an accounting firm,' I'd be more willing to hear what they had to say," said Latham. "It really has to be something that drives value that is existing right now."

One major key to a successful business now is to keep the investment low, said Dan Perkins, a volunteer with SCORE, a Boston-based agency that provides advice and counseling to entrepreneurs.

"You can get lease space under better terms than you could a year ago, and there are opportunities to go into a business at a lower cost level than before," Perkins said. He said he primarily recommends that they keep their overhead budgets low.

"Most of these people are following their dream," he said. "I tell them to start in a smaller way and try to bootstrap it. Not only is it harder to get money from banks, but also from friends and family."

Paula Cofman and Rafca Cardoos, both of Hull, didn't ask their relatives for money but received all kinds of donations of equipment and help from them in setting up their new Nantasket Avenue storefront for their takeout business, called To Dine For, which opened last month.

Cardoos's husband set up the storefront space. Cofman's husband did the painting. Some people who had large kitchen equipment in storage donated it to the women.

"It was really a community effort," said Cofman, 45, who has lived in Hull for 16 years. "Everyone just chipped in and got it done."

And instead of investing in top-of-the-line grills and fryers off the bat, the women have been putting in long hours each day until they can save enough to buy the equipment that will make life a little easier.

"We feel we'd rather work a couple extra hours a day than invest a ton of money and not know if our business is going to survive," Cofman said. "Our investment was really reasonable, relatively small for this type of business, so we felt if anything happened in a year, we're really not going to get hurt. I don't think we have anything to lose."

In Middleborough, meanwhile, three women were able to open Ragz consignment shop early this year after they approached the owner of a downtown storefront and got a deal on the rent. The partners said the landlord allowed them to forgo signing a lease, which they found helpful because, if their business failed, they wouldn't be locked into keeping the storefront for a year.

To further cut their costs, the entrepreneurs themselves staff the shop, which sells second-hand accessories and fashion for women.

"The only way we could make it a little worth our while was to self-run it," said Kim Henderson, a 46-year-old hairdresser who works in a salon next door to the shop. "For us to hire anyone else wouldn't be feasible."

Before the shop opened, the women all agreed that a consignment shop was "economy friendly" and would help people save money. They also noted that the fashions in style today include the recycled vintage look, popular especially with teenagers.

"Five years ago, you wouldn't catch a teenager in a consignment shop, and now it's the thing to do," Henderson said.

Back in Sharon, the owners of the Himalayan Bistro in West Roxbury are counting on their wide South Shore client base - and their food, of course - to make their opening of the Coriander Bistro a success. The Himalayan Bistro draws clients from Sharon, Canton, Walpole, and Milton, and co-owner Ram Dhital says the new Sharon locale is central among its patrons. The new eatery has opened for a lunch buffet and serves from an a la carte dinner menu.

"We have been very successful," said Dhital. "I'm not nervous at all. I will be successful there, too."

Franci Richardson Ellement can be reached at richardsonfranci@hotmail.com.

More about
Dr. Miri Park

Dr. Park in the Boston Globe and Sharon Advocate.

An article written by Dr. Park in the Sharon Advocate.

Dr. Park featured in Women in Optometry November 2010 in the Review of Optometry