Helping new business owners succeed

Erica Burke (right) and her mentor, Eleanor Clayborn, coordinator of Economic Alternatives
Erica Burke (right) and her mentor, Eleanor Clayborn, coordinator of Economic Alternatives

With the help of SHSM, a passion becomes a business

Erica Burke of Ashland, Miss., has always loved to style people’s hair. At 15 she started braiding her friends’ hair and realized that she had found her passion.

“I was the first graduate from J&J Hair Design College in Holly Springs, Mississippi,” said Erica. Armed with her degree, Erica began work in a hair salon. But the salon wasn’t hers; she wanted to run her own shop.

Erica and her husband prayed over renting an old grocery store with their savings. Eventually they worked out a deal with the owner: they’d fix up the place in exchange for free rent during the first few months of a two-year lease.

Then she needed to come up with a name for her salon.

“Every time I touch a person’s hair the person seems to leave with a glow,” Erica said, so she named her shop “Burkes Touch & Glow Beauty Salon.” The salon opened to walk-in traffic; and bills. That’s when Erica realized she needed a few business classes.

Erica in front of her salon
Erica in front of her salon

Erica signed up for free business classes at the Holly Springs Catholic Social Service office, operated by Sacred Heart Southern Missions. There she met Eleanor Clayborn, coordinator of the Economic Alternatives program, who encouraged Erica to complete the FDIC Small Business program. This program is offered without charge to non-profits to encourage them to work with entrepreneurs in their communities to develop good business practices.

The program was just what Erica needed but her work schedule didn’t fit the class times. Eleanor offered her one-on-one sessions.

Starting in September, 2011, Erica and Eleanor met once a week for a year. Reviewing the salon, Erica thought that she had a good start and wanted to apply for a small business loan to purchase more equipment. That was when Eleanor began asking the hard questions.

“Are you an LLC (Limited Liability Corporation) or Sole-Proprietor?” asked Eleanor. “Do you have a business plan? How are you tracking income and expenses?”

“I didn’t know what an LLC was,” Erica remembers. However, with Eleanor’s help she was able to learn how to answer these questions and get her business on the right track.

Erica wanted to apply for a small business loan and she did have a two-page business plan. “But Eleanor said to me, ‘Let’s make a stronger business plan that can be used later.’” So they built Erica’s business plan and filed the paperwork to become a LLC. Eleanor taught Erica about bookkeeping with Microsoft Excel spreadsheets so she could track income, expenses, and taxes. Then Erica applied to the Self-Employment Loan Fund of Sacred Heart Southern Missions, which provides loans to individuals with small businesses. To her delight and relief, she was approved.

“With the loan, I bought equipment and advertising,” said Erica.

Erica still meets with Eleanor, but the relationship has changed. Eleanor is more of a resource now rather than a teacher. “I have to pull back,” said Eleanor. “I request written quarterly reports for one year after a new business owner completes our program.” But then she has to remind herself that in the end it is the former student’s business, not hers. The hope is always that the new business owner has learned the tools that s/he needs. But the program staff are still there to answer questions.

Erica says that she is grateful for the FDIC program; she plans to enroll in more classes to improve her management style.

Other small business owners in the community have participated in the FDIC program. After each participant completes the course, the FDIC asks him or her to complete a survey. The Holly Springs Economic Alternatives program has received so many positive responses that the FDIC named it as a “Premiere Program.”

Our thanks to April Turner at Sacred Heart Southern Missions for sending us this story and the accompanying photos.