Feature Stories - February 2006

Breaking Barriers in the Silver State:

Minority-Owned Businesses in Nevada

by Jennifer Rachel Baumer

Imagine wanting to start up your own business in a new place. Working through regulatory and government licensing procedures is hard enough, but imagine that in addition to new procedures, you have to learn a whole new language. Imagine discussing business with a potential new client by phone, only to have him react with shock when you meet in person and he sees the color of your skin.

Minority business owners face these challenges whether they’re African American, Hispanic or Asian and whether their business is related to their ethnicity or not. It’s one more obstacle on the way to doing business. In 1997 Nevada listed 6,600 Hispanic-owned businesses, 2,800 owned by African Americans, 5,000 Asian-owned and 1,200 owned by American Indians. (Source: SBA Small Business Profile, 2004.)

Minority business owners face the same challenges every business owner faces: competition, available workforce, too much or too little growth, financing. When it comes to specialized needs, ethnic chambers of commerce exist to help level the playing field and to answer some of the most obvious challenges. This ensures that when we say, "I think we’re speaking the same language here," we really are.

Dreaming in English

Carmen and Miguel Castillo own Greenbrae Cleaners in Sparks. As immigrants to the U.S., one of their biggest challenges was learning English. "We came to this country in 1999 and now we are homeowners and business owners," said Carmen Castillo. "We’re just trying to keep up a good attitude and keep studying the language. That was a challenge and it still is, because we need to learn more."

Miguel Castillo started working in a dry cleaning business 13 years ago. He liked the environment enough that when a job opening came up, Carmen joined him. Eventually one of their co-workers became an owner and when she decided to sell two years ago, the Castillos bought the business.

Working their way through the complexities of both owning a business and learning a new language, they joined the Hispanic Chamber of Commerce, which Castillo calls her comfort zone. The chamber helped her buy the business and navigate the licensing requirements. Along the way the Castillos attended all the classes and meetings possible and continued learning English. One day the two were surprised to discover they had begun to dream in English rather than Spanish.

The Castillos’ business is growing steadily – slowly enough that they can assimilate the information they need and quickly enough that they describe their days as "rush, rush, rush." The customers keep coming and the two report they haven’t really encountered discrimination.

Breaking Down Barriers

Marcel Fernando Schaerer works with language barriers all the time. In his company, International Professional Development Services, he and his wife Sylvia work to address communications in the workplace – specifically, focusing on language issues, cultural differences and human resource-related training. As a small business owner, minority business owner and as someone who works with minorities in the workforce, Schaerer has seen far more barriers against minorities in business – such as language barriers – than actual discrimination.

Aracelica Parades said if she has experienced discrimination, she hasn’t noticed. Likely she doesn’t have time. With her husband, Julio Roberto Parades, she owns four Hispanic grocery stores called Super Mercado del Pueblo, which serve Southern Nevada from locations in Las Vegas and North Las Vegas. Operating since 1994, the obstacles she’s had to overcome as a minority business owner are no different than those faced by anyone else – a lack of time and the need to work 12 to 14 hours a day, seven days a week to make it work.

What Parades has experienced is the language barrier. "We came to this country in the ’70s and didn’t know one word of English," she said. "There’s probably some language barrier even now because my first language is Spanish. I know English well, but there are some words I still don’t understand. That’s been an obstacle, but one I’ve obviously overcome, because I’m here now, regardless of what I’ve had to face." Parades said her greatest challenge is managing 300 employees in four locations.

The Parades are members of the Latin Chamber of Commerce and started the Del Pueblo Foundation to help needy children in the Las Vegas Hispanic population. Parades said she doesn’t have time to worry about discrimination and isn’t going to let it bother her. "I just go on," she explained. "In Las Vegas, everyone does their own thing. I do my own thing and if somebody likes it, good; if they don’t, they don’t."

Just off the Las Vegas Strip, Especially for You Gifts is making in-roads with the MGM Mirage group of casinos, creating gifts for the gaming giant’s holiday parties. A woman-owned small business that’s also minority owned –president Debra Harris is African American – the company is facing the usual day-to-day challenges of small business.

"Just getting our name out there," said Harris. "Letting people know we exist, and not succumbing to temptation to join every networking group." She has joined the Nevada Minority Business Council (NMBC) and the Las Vegas and Henderson Chambers of Commerce.

Harris hasn’t experienced discrimination in Southern Nevada – she said people in Las Vegas are friendly and very willing to do business as long as the company provides a great service. However, she did experience prejudice in Chicago. Working by phone with a potential client to produce some very high-end gifts for the client company’s holiday party, when they finally met in person, the client was stunned.

"She didn’t know I was a minority businesswoman and she was staggered, you could tell," Harris recalled. "I told her ‘If you’re okay, I’m okay,’ but she was so shocked." Especially for You Gifts completed the holiday gift project and went on to establish a long-term relationship with the client’s company, but only, Harris believes, because she had successfully done business with the company over the course of several years.

Tim Wong is president and CEO of Arcata Associates, Inc., a company that provides engineering services, information technology and multimedia services for government agencies and commercial companies. Founded 26 years ago in Northern California by Wong’s father, Arcata moved to Las Vegas in 1987 because a large percentage of its work supported the Air Warfare Center at Nellis Air Force Base. It also has personnel stationed at the Dryden Flight Research Center at Edwards Air Force Base in California, and was involved in the landing of the space shuttle there last year.

Wong helped recreate the company in 1993. At the time, 75 percent of its revenue base was tied into one contract, which was up for renewal against several competitors. Arcata, which had worked primarily in air warfare, needed to look beyond Department of Defense contracts. Today the firm operates out of 11 states and a number of NASA centers, naval facilities and support companies that relate to its air warfare expertise.

Operating a small business and a minority- owned business means Arcata can compete for government procurement contracts, but also has led to incidents of discrimination. "When my father started the company 26 years ago, very few minority contractors performed technical work for the federal government," Wong explained. "He faced overt discrimination because there was doubt that a minority-owned company could perform up to the required standards."

Wong said Arcata and other minority contractors have proved the quality of their work, and today the prejudice he faces is more a question of ethnicity than of skills. "The concern is because I’m Chinese, there may be a desire to give information to the People’s Republic of China, which never has been done or ever would be done," said Wong. "It’s just strange that my ethnic background would raise questions about my allegiance to the United States, especially since I was born here, and so were both my parents."

Being a small business in the world of government contracts is challenging on its own. "We do not have the luxury of having a bad day," said Wong. While large corporations can make mistakes and continue their relationships with the government, he said one slip-up could cause a small business like Arcata to be forever barred from doing business with the U.S. government.

Leveling the Playing Field

Discrimination isn’t always obvious. Wong can’t say for certain whether he’s ever lost a contract because of his ethnic background, but he’s had people question whether he’s a security risk, and he finds it disconcerting.

Sometimes, however, discrimination opens unexpected doors. "Some business owners are displaced entrepreneurs," said Debra Baez, managing partner of Baez Design, a graphic design firm she owns with her husband, Anon Baez. "It’s almost as if they are forced to go into business for themselves because they can’t get promotions at their job. I know my husband would have rather fallen into a great job as an art director, but he was forced to start his own business and pull himself up by the bootstraps."

Debra and Anon Baez have worked together for 24 years, originally in New York City and rural New York state, and for the last seven years in Nevada. Debra Baez became involved as a mentor to Hispanic teens and small women-owned and minority-owned businesses, and became even more involved after learning that in Las Vegas, 79 percent of the Hispanic population speaks only Spanish. Baez wants to help, and she wants to be involved. While she’s witnessed much less blatant discrimination in Southern Nevada than she did in New York, she said Las Vegas is such a small business community that, "Messing up once with a client means you might as well leave town and start over somewhere else." She wants to help minorities learn to interact in the business community in a professional manner, from image to business card to presentation. And because both the Latin Chamber of Commerce and NMBC helped Baez Design along the way, she’s involved with both organizations.

Organizations Provide Support

The Nevada Minority Business Council in Southern Nevada works to foster a thriving business community. Healthy business climates within minority communities translate into healthy economics throughout the community at large – more jobs, more tax benefits and opportunities for business expansion. Along with individual ethnic chambers of commerce, NMPC helps minority business owners come up with what they need, whether it’s introductions to buyers and clients or certification as a minority-owned or disadvantaged company, which can help small businesses bid on government procurement contracts and other opportunities.

Minority chambers of commerce can help with networking, referrals, financial concerns and eliminating the language barrier. Carmen Castillo credits the Hispanic Chamber of Commerce in Northern Nevada with helping her along the way, with classes and information on owning a business, learning English and filling out business licensing applications.

For Debra Harris, NMBC’s Minority Business Opportunity Day has helped enormously. The event allows business owners to set appointments with a number of major corporate players in Southern Nevada – appointments they might not have been able to get otherwise. "We were able to sit down for 10 or 15 minutes with the buyers and purchasing agents of major companies, including the MGM Mirage group of casinos, Nevada Power Company and Boyd Gaming, among others," said Harris.

Erick Sanchez, president of General Design & Construction, is a member of the Latin Chamber of Commerce, part of its Business Development Committee, and involved with NMBC. Sanchez is a native Las Vegan who started his company in 1996, so he already has ties to the community. NMBC helped him obtain certification as a minority-owned business and a disadvantaged business. "That’s created opportunities for us, opening the doors to larger companies that we may not have been able to just call up," said Sanchez. "We wouldn’t know who to cold-call at Harrah’s or MGM Mirage or Clark County government and say, ‘We’re a general contractor and project manager. Can we do business with you?’ I don’t believe those opportunities are so easily available without the organizations we’ve joined."

General Design & Construction is a general contracting and project management firm working in Southern Nevada, chiefly within the hospitality industry. They have the same challenges all construction firms in Southern Nevada are facing – finding employees, not growing so fast that they leave quality behind, choosing the best of the opportunities that come their way, and finding good, dependable sub-contractors.

"Once you do that and you’re working in the hospitality industry, you’re still facing change," said Sanchez. "We’re constantly finding that our large corporate clients are changing, such as when Harrah’s bought Caesars and MGM bought Mandalay. When this happens, it’s like you almost have to reinvent yourself with that company. Through it all, our clients have welcomed the opportunity to work with a minority-owned business."

That’s where the minority councils help out; not with handouts or special favors, Sanchez said, but with opportunities, a chance to bid on projects. Relationships help. So do organizations.

Crear Creative Group, a full-service advertising, marketing and PR firm, is another minority-owned business that’s received certification. Crear Creative’s African American president, Cedric Crear, also joined the Urban Chamber of Commerce and the AIGA (American Institute of Graphic Arts). Born and raised in Las Vegas, Crear said the biggest challenge facing his firm is the rate at which it is growing. He said success depends on a solid business plan, solid accounts and the relationships formed in organizations.

The minority business organizations are all about leveling the playing field and creating opportunities. "If it helps us get work, great. But we want the work because we feel we’re the best in the business, not as a minority-owned business. My experience is from doing major work in town," said Larry England, president of Pueblo Tribe LLC, a construction sub-contractor in Southern Nevada that does lath, plaster, metal studs, drywall, painting and taping. "I want them to recognize me not as a minority but as Larry England, the guy with the experience."

England worked with NMBC to complete the certification process as a minority-owned, disadvantaged business and is registered with the Bureau of Indian Affairs. "With the Minority Council, you go through a rigorous application process, which weeds out companies trying to get certified who aren’t running their own business, but acting as a front for somebody else to pull in work through the minority sector. It creates peace of mind for people knowing they’re hiring certified minority-owned businesses."

England said he has experienced discrimination when fighting against the image of a minority contractor as "two guys working out of the back of a pickup with their office in a garage." He said, "It’s the biggest stereotype and unfortunately is the truth in many cases." That’s why he sought certification for his company. While he has faced that type of discrimination, it’s not stopping him. "I’d say yes, I’ve seen it, but discrimination comes in many different forms and I probably face it daily. But I don’t go hide in the closet – I call it, on the spot. If you come across it, you should be forceful and put your foot down. If you get knocked down, get up. If you can’t handle it, you shouldn’t be a minority contractor – that’s a part of life."

"I think diversity initiatives in larger companies, as well as the support system of business groups, present a great opportunity for our company and other companies like ours that are owned by minorities or women or veterans or disadvantaged people," said Sanchez. "It’s creating a great business community and many opportunities. Our clients, like hotel companies and governments, have customers from all races and walks of life, so I think it’s great they’re recognizing they want to work with all types of people and create opportunities for them across the board."

Nevada Small Business Development Center (Northern Nevada, Southern Nevada – University Campuses) nsbdc.org

Carson City (775) 882-1565

Reno (775) 784-1717

Pahrump (775) 751-1947

Henderson (702) 992-7208

Las Vegas (702) 895-4270