Korean-American Small Business

According to the U.S. National Bureau of Economic Research, Korean-Americans, as an ethnic group, have the highest rate of entrepreneurship in the country, with 28 percent of men and 20 percent of women owning their own businesses (“Korea Playing for Big Stakes,” 2001). One reason for these high numbers may be due to the fact that these businesses are often passed between friends and family. For example, in 1975, Doug Choi and his family went from owning and operating a produce store in Brooklyn to acquiring a stationery store in Manhattan through a friend, and finally to a deli on Third Avenue in September of 1994 (MacDonald, 1995). The dynamic nature of these small businesses allows owners such as the Choi family to take a loss at one location and try again in another. Their experience with several business enterprises over a relatively short period is not uncommon for the Korean-American entrepreneur.

Most Korean businesses are small and operated by a husband and wife tandem. The owners usually work more than twelve hours and day, and six or seven days a week. Typical Korean operations include green grocers, dry cleaners, fish markets, restaurants, delicatessens and nail salons. In New York City, Korean green grocers number about 1,400 (Park, 1997). Because these businesses rely on both Koreans and non-Koreans for wholesale suppliers, workers, and clientele, owners must be able to develop different strategies to attract customers in their respective neighborhoods. For example, a store in Manhattan will cater to their customers by including a self-service salad bar with hot dishes to satisfy their need for a quick meal. Another popular business that Korean entrepreneurs take on is that of dry cleaning. Although it requires more capital than a green grocer or fish market, there are about 2,000 dry cleaners run by Koreans in New York City (Park, 1997).

Numerous Korean-American entrepreneurs have successfully developed businesses in inner-city neighborhoods, areas that most retailers have ignored and abandoned in the past. In doing so, Korean-Americans have helped transform some inner-city areas from economic ghost towns into places of commerce. And during this process, these individuals may have outlined a partial blueprint on how to repair the recently ravaged economy (MacDonald, 1995). For example, twenty years ago the long block between Broadway and Fifth Avenue in New York was crumbling fast. Customers slowly stopped patronizing the stores in the area because they were afraid of crime. Opportunistic Korean entrepreneurs spotted this potential and wholesalers began lining up to serve the import-export companies in the area. Today the area is safe as businesses run around the clock (MacDonald, 1995).

Another major obstacle Korean-American entrepreneurs face is raising venture capital. (more…)

The Economics of Hair How did African Americans

lose control of the billion-dollar black hair-care industry? (Sherri Day)

By 1954, George E. Johnson had become the father of the modern ethnic hair-care industry. By

adding emulsifiers to the existing crude formula for conkolene, Johnson made the chemical

straightening process much less painful. In 1971, his Johnson Products Company became the first

black-owned firm to be listed on a major stock exchange. Twenty-two years later, the company

was sold to the white-owned Ivax Corporation. Presently only four of the country’s top ten

hair-care-product manufacturers are black- owned.

The full-color glossy magazine Beauty Times is packed with news about the latest black hair-care

trends. All of its articles are written entirely in Korean. So are its advertisements, depicting black

models with braided hair or freshly conked tresses. The magazine’s existence indicates that, from the

laboratory where products are made to the outlets in which they are sold, it’s a new day in

black hair care. (more…)