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2000 Small Business profiles
Monday, March 13, 2000
by Monica Soto
The Muhammads' plan was to start serving fish sandwiches and salmon burgers at their eatery in Seattle's Central District in April 1998. It took an additional year and eight months before their business opened.
The couple's business plan was rejected by a half-dozen lenders. "They tell you these programs are for people who have a vision, who have a dream, but it wasn't like that," says JoAnn Muhammad. "We had such a difficult time."
The Muhammads, in ways, represent the typical small-business owner's plight. The couple used their life savings -- including 401(k) plans, stocks and work bonuses -- to start their own restaurant, lured by the idea of becoming their own bosses and possibly achieving financial independence.
In their case, JoAnn Muhammad encouraged her husband to quit his job as an AirTouch Cellular sales representative and follow his dream of opening his own restaurant. Three years ago on his birthday, JoAnn coaxed him into catering lunch for a day at their work. She put together 60 orders for his famous fish sandwiches and veggie burgers.
"It was a smash," Vance Muhammad says. "We got nothing but positive feedback. Once we did that, my courage increased. I thought, 'You know what, you might be right.' "
The Muhammads found and began renting the Yesler Way space for $500 a month in April 1998, with plans of opening the restaurant a few months later. The couple, however, didn't own a house to use as collateral for a loan. After being turned down by lenders, they kept paying rent on the space and saved the start-up money instead.
Eugene Wasserman, executive director for the Neighborhood Business Council, says a tremendous number of cafes and restaurant have sprung up in the Seattle area in recent years. Running such a business, he says, requires common sense.
"Small businesses aren't romantic," he says. "You're dealing with your own money. If you're not careful with your money, you wind up in trouble."
A number of programs offer help to small businesses in the area. Community Capital Development oversees a community-development block grant that provides a loan pool for small businesses. The program so far has doled out more than 100 loans, ranging from $10,000 to $100,000.
Five years ago, the University of Washington business school started a program that uses MBA students as consultants for small businesses in the Rainier Valley and Central and International districts. Currently, the Business and Economic Development program's 75 students help 15 inner-city companies solve problems or capitalize on opportunities.
Michael Verchot, program director, says one of the biggest challenges for small-business owners is they tend to use their life savings to open the business and must rely on credit cards with high interest rates or other forms of borrowing to sustain them.
"It's not surprising for businesses to go a year or two before they turn a profit," he says. "For companies who get started and don't have any working capital, it puts them in a tight spot."
The Muhammads say it took hard work and a lot of faith to stick with their original plan, especially when they started to run out of money.
"I had high expectations; it was just faith," JoAnn Muhammad says. "We had to be patient. When the awning was coming, we needed money to hire a contractor. (Vance) would come to me and say, 'This is not going to happen.' I would tell him, 'I don't want to hear it. This is going to happen.' "
Vance Muhammad, who had never opened a business, wanted to wait until everything was perfect. His wife literally made him open the restaurant Dec. 18. "I was afraid," he says. "My wife, she was the one who made me open up the doors."
The cafe is small and spotless. JoAnn Muhammad dreamed up the decor: Part of the cafe is yellow and part is orange to signify the sun's passage from east to west. Four tables hold silk sunflower arrangements.
The menu is built around the idea that residents of the Central District should have a healthful alternative. The cafe serves no pork products and offers items such as fruit smoothies, fish sandwiches, and veggie, salmon and chicken burgers.
Verchot of the UW program says there's a significant concentration of service and retail businesses in the Central District, based partly on the availability of commercial space, zoning regulations and other factors.
"It makes perfect rational sense," Verchot says. "If you don't have family wealth to bring into a business, then you start a business that has low capital requirements."
Vershot says, however, that the neighborhood's economy is not diverse enough. There are "a large number of very small businesses that, because of undercapitalization, have limited growth potential. It's not the business owner's fault. The wish is: How can we start up a ladder in terms of increasing the potential number of employees? How can we increase technology companies and the number of distribution companies? Those are some of the bigger economic-development questions that we need to address."
Small-business owners in the area face other challenges, including rising housing costs, which are pushing longtime residents and those on fixed incomes to other communities.
Verchot says developing other thriving Central District businesses in the midst of a booming economy is crucial. "If we can't grow inner-city companies that provide for wealth accumulation and job opportunities when times are good, we won't ever be able to do that," he says. "I see some very positive things happening, but we're not there yet."
Vance Muhammad sits at a table, his arms folded and resting on the counter, a chef's hat slightly tilted to reveal twist braids. The entire day has been slow.
The first customer of the night, 8-year-old Jabril Mack, saunters into the restaurant, one shoe untied, and orders the children's fish meal, which costs $3.22. Asked if he likes fish sandwiches, he wrinkles his nose and shakes his head from side to side.
"Mom called here," he says, smiling shyly. "She's next door getting her hair braided."
The second customer, John Muhammad, 33, orders a veggie burger light on the onion and with cheese, accompanied by bean soup and a cup of water.
Brother John, as the cafe owners call him, is wearing a crisp black suit with a bow tie, a black fedora and horned-rimmed glasses. He has a black overcoat draped over his left arm.
Muhammad, who works in sales, says he came to the restaurant for the first time a week after it opened. Now he comes here on occasion to unwind or study. He calls the place an oasis.
"For this area, which is sometimes considered a sore spot, this is a garden," he says. "It's like a role model. Until you see someone doing something, you don't think you can do it yourself; so what they're doing is beautiful."
Vance Muhammad says he and his wife truly feel they're a part of the community. Not long after they opened, a homeless woman asked if she could do something for them. "Me and my wife, we looked at each other," he says. "We knew the right thing to do: Give the woman some work."
The couple asked the woman to sweep and mop. When she was through, they tried to give her money. "She said, 'That's not why I came here,' " he says. " 'What I did was my contribution to Shabazz Cafe. That's how happy I am you're here.'
"It's been like that, that sort of thing," he says. "It's been amazing. This place is blessed."
Above all else, JoAnn Muhammad says, she and her husband want to create a sense of community in the Central District. "We want to let them know that we care, that this is theirs," she says. "Even in the heart of the Central District -- that the heart doesn't stop beating."
Monica Soto's phone message number is 206-515-5632. Her e-mail address is: email@example.com.
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