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|Starting a business is hard work.
For a person with a disability working with a vocational rehabilitation
agency it requires a deliberate, detailed process. Figure 2 represents
a recommended Self-Employment Process for
Vocational Rehabilitation agencies. This chapter briefly introduces
each step of the process. Later chapters expand on key ideas and procedures.
It was developed by researchers at the Research and Training Center on
Rural Rehabilitation Services after analyzing 45 state VR agency policies/procedures
on self-employment. The process evolved from working with self-employment
consultants, VR counselors and administrators, and consumers. It incorporates
VR practice with current state-of-the art small business development practice.
Although not indicated on Figure 2 by a decision point, the decision to pursue or not to pursue self-employment can be made at any time in the process by either the consumer or the VR agency. Reasons for not continuing to pursue self-employment likely will vary according to where the process was halted.
Step 1: The Individual Expresses Interest in Self-Employment
There are consumers who already have business ideas, know they want
to be self-employed and will not hesitate to tell you this. Less-assertive
people may have the potential for owning a business, but will not mention
self-employment as a goal unless they are specifically informed that
it is an option.
Step 2: Counselor and Individual Discuss Advantages and Disadvantages of Self-Employment
In this step, the counselor and individual begin a dialogue.
The individual tells you about his or her business idea(s), and you
get a feel for how realistic the individual is regarding the proposed
Advantages of Self-Employment
Disadvantages of Self-Employment
Step 3: Self-Employment Assessment
We recommend a self-employment assessment consisting of two phases. During Phase I, the individual completes a feasibility study to develop the business idea into an initial draft of the business plan. During this step the business idea becomes more concrete and the individual begins to identify:
forms (see Table of Contents) used in this step are
Step 4: Develop the Individual Plan of Employment
The employment goal is identified after Step 3. If the
decision is to continue and pursue self-employment, indicate in the
Individual Plan of Employment (IPE) a specific occupation or occupational
grouping based on the type of business the consumer wishes to start.
Self-employment IS NOT determined as the specific goal at this time,
however. This should have been explained to the consumer during step
2, and should be reiterated now.
Step 5: Identify Sources for Training, Education, and for Preparing for Self-Employment
Ideally, the assessment phase identified knowledge and
skills that the consumer should pursue to enhance the business's success.
Services, education, or training may help the consumer develop a business
plan or remedy any deficiencies in skills or knowledge. Locating training
resources in rural areas might be difficult - you and the consumer may
have to be creative. For example, if he or she needs computer training
but classes are not available locally, consider paying a local computer
wizard to provide the training.
Step 6: The Individual Successfully Completes Services, Training, or Education (Steps 6 and 7 can be completed concurrently with Steps 8 through 10.)
If everything goes as planned, the individual will successfully complete
needed services, training, or education. If the person does not successfully
complete services, training, or education, then it is important to ascertain
why. The individual may have been dissatisfied with the training or
services - it may not have met his or her needs or may have been too
academic. If so, perhaps another, less academic method should be explored.
After spending time in a business or an apprenticeship, the individual
may have realized that he or she does not want to start that type of
business or work at the level needed to make the business a success.
Perhaps another type of business could be pursued, or the person should
consider working for someone else in the type of business described
in the IPE.
Step 7: Determine Continued Interest
This is an opportunity for the agency to re-evaluate the individual's
initiative and drive, and to determine how invested he or she is in
starting the proposed business. It also is an opportunity for the consumer
to re-evaluate his or her desire to become self-employed.
Step 8: Individual and Counselor Work with Consultants to Develop Plan, Marketing and Funding Strategies
If there is continued
interest, the next step is to take the business plan from a draft to
a comprehensive document. A good comprehensive business plan will be
the new business's road map, can be used to obtain necessary funding,
and is necessary for judging the potential for success.
Step 9: Counselor and Individual Evaluate All Business Plan Drafts
With the consumer,
evaluate all drafts of the business plan for completeness and thoroughness.
After completing this manual, you will be able to evaluate a plan and
request any necessary clarification and changes from the consumer.
Step 10: The Business Plan is Complete
A completed plan
is necessary for step 11.
Step 11: Re-Evaluate the Individual and the Proposed Business
At this critical
point in the process the agency evaluates both the consumer and his
or her proposed business to determine if VR will provide support. We
recommend administering the Business Assessment Scale a second time
to evaluate both the individual and the business idea, in conjunction
with previous assessment(s), the completed business plan, the business
consultant's input, other sources (e.g., training placement), and your
own experience with this person.
Step 12: Amend the IPE and Determine Parameters of VR Contribution
>Up to this point, self-employment has not been formally identified
as the employment outcome. If the agency has decided to support the
business, amend the IPE and determine the level of VR funding for the
business. In this step, the VR agency establishes a funding range and
describes how funds are to be used (e.g., to purchase equipment, inventory,
or marketing services). The agency's contribution is finalized if the
business is so small that additional funds will not be sought.
Step 13: The Plan is Submitted to Potential Funders for Start-Up Funds
Potential funders include family, friends, banks, microloan programs,
and Social Security Administration Plans for Achieving Self-Support
(PASS). Chapter 7, "Resources and Resource Partners" discusses
many possible sources of funding except PASS. Chapter 8 describes how
to use a PASS plan for self-employment.
Step 14: Finalize VR Funding and Open the Business
Now that VR knows
all the funding sources and amounts, you can reevaluate previously-established
parameters, finalize VR's contribution and specify how start-up funds
will be used.
Step 15: Assist the Business Owner With Developing a Support System
Although self-employment experts agree that follow-up support is important
to business success, VR agencies do not generally offer long-term, ongoing
supports. VR might provide support in a crisis, but not the day-to-day
networking and consulting that business owners need. Before a business
opens, contract with a consultant to review the business's monthly or
bi-monthly financial statements, discuss the business with its owner,
and report back to the agency. Encourage the business owner to develop
his or her own support system such as finding a mentor or networking
with other business owners.
Step 16: Close the Case
Generally, VR and the business owner mutually agree to close the case
without having pre-defined or -delineated circumstances. However, some
agencies have indicators for case closure. These include meeting the
requirements of a core indicator, plus one additional indicator. Indicators
may vary. In Alabama, the core indicator is that the individual has
been in business for 90 days, has not been provided additional agency
support, and has reinvested in the business to support ongoing expenses.
Additional indicators include: terminated SSDI, decreased public benefits,
realizing a net profit from the business, significant gross business
income, or increased equity such as equipment or savings.
Step 17: Evaluation by the Business Owner and VR
Evaluation by both parties provides valuable information on the agency's services and their impact on the individual and the community. We recommend that the business owner evaluate the VR agency annually, for up to three years. This provides information to the agency on the effectiveness and usefulness of its services - information it can use to improve self-employment procedures. Conversely, we recommend that the agency evaluate the business annually for an unspecified period. Evaluations provide the agency with data on the effectiveness of its services and the return on the money and time it has invested in the business. Evaluations also assess how VR-funded self-employment start-ups affect the community, and chronicle the longevity and cycle of self-employment.
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