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Businesses Important to South
AUBURN, May 1---
Economic development is high on the priority list across the South,
but some experts believe a contributor to this success is being
overlooked.
Home-based businesses
annually bring millions of dollars to the rural economies of the
South. These are the earliest business form, and they offer rural
communities the opportunity to develop local assets and keep
residents in the community.
These findings were
recently released in a Southern Rural Development Center publication
titled "Home-based businesses: Implications for the rural
economy of the South." The Center, headquartered at Mississippi
State University, released the
publication written by
Pamela Brown at Texas A&M University and Glenn Muske at Oklahoma
State University.
"Home-based
businesses fit so seamlessly into the community that they simply are
not noticed for what they are -- functional and contributing micro
businesses," the publication states.
In rural Southern
communities, the three important factors economic development
depends on are individual entrepreneurial spirit, local initiative
to embrace change and a quality of life that people desire.
Brown, an Extension
consumer sciences specialist at Texas A&M, says home-based
businesses embrace all three of these components because they are
based on the creative, entrepreneurial energy of individuals.
Despite their importance
to local rural communities, home-based businesses are often
invisible. They tend not to be members of chambers of commerce, and
they don't have a sign out front announcing their presence,"
Brown said.
"They're busy doing
their own thing."
While many home-based
businesses thrive under these conditions, the danger is that they
will isolate themselves from their community and think too narrowly
about their market.
"Fear often keeps a
home-based businessperson from reaching out. They don't know how to
handle the bigness or how to garner more capital," Brown said.
"When they reach a crossroads, they may choose to pull back
because they are uncertain about their
capabilities."
The majority of
home-based businesses earn less than $25,000 a year. Many provide
supplementary income, but conservative estimates are that these
businesses generate more than $10 billion of income annually in the
South.
In 1989, Muske,
Extension home-based and microbusiness specialist at Oklahoma State
University, said 40 percent of home-based businesses were
service-oriented while 60 percent offered a product. By 1996, those
percentages had switched.
"We're definitely
seeing a service economy," Muske said. "There is more
service development than product development among home-based
businesses."
While many people start
a home-based business to bring in extra dollars, others do it for
personal fulfillment.
"The main reason
people operate a home-based business is control. 'I have a passion,
and I want to be in control of my own life.' Running your own
home-based business allows control, family time and esteem. It's the
American dream of owning your own house and owning your own
business," Muske said.
One of the challenges
facing rural communities in the 21st century is community economic
development. Home-based businesses are an important part of the
communities' success and survival.
This publication,
"Home-based businesses: Implications for the rural economy of
the South" can be viewed online at http://www.ext.msstate.edu/srdc/hot/hot.htm.
For copies or more information, contact the Southern Rural
Development Center at (662) 325-3207.
SOURCE: Southern Rural
Development Center, Mississippi State University
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