Self-Employment Steps for Vocational Rehabilitation Counselors: Helping a Consumer Start a Business

Chapter 5

Who Does What in the Process

Business development experts stress the importance of consumer initiative and ability to complete a task. They tell us that people who are likely to be successfully self-employed should not have to be "spoon fed." However, taking initiative does not preclude being provided with direction, rationale, and support. Developing the business plan requires a wide range of skills and knowledge. Most potential business owners you will work with have not developed a business plan before. Many are capable of developing a plan but their skills are undeveloped. That is why we recommend they work with a business development consultant who will guide them with developing their business plan. Possible sources of assistance are listed in Chapter 7, "Resources and Resource Partners." In this chapter, we outline appropriate roles for the consumer, counselor, and business development consultant.

The Consumer's Role

The potential business owner ultimately is responsible for:

  • Deciding what business to pursue
  • Conducting a feasibility study
  • Developing a business plan 
  • Obtaining necessary permits, licenses, and insurances 
  • Hiring employees 
  • Securing business start-up funds 
  • Developing customers 
  • Locating suppliers 
  • Starting the business.

The Counselor's Role

In addition to the counseling relationship, your role in the self-employment process also includes:

  • Explaining VR's, the consumer's, and any other organization's (e.g., business development consultant) role in the self-employment process
  • Clearly communicating the self-employment process that will be followed including how agency decisions will be made for pursuing self-employment
  • Communicating whether and how the agency will help with training, developing a business plan, and VR funding of the business
  • Helping the consumer decide which business to pursue
  • Deciding which assessments, if any, will be used
  • Guiding the feasibility study including conducting or co-conducting any assessments and interpreting the results to determine whether or not to proceed
  • Providing information necessary to assist the consumer with developing a business plan
  • Supporting the consumer and being the liaison between him or her and consultants and lenders
  • Reviewing the final business plan to determine the agency's contribution, if any

The Business Development Consultant's Role

The business development consultant:

  • Does not develop the business plan, but guides the consumer through the process with expertise and a realistic perspective
  • Recommends potential funding sources
  • May help assemble a funding package
  • Readies the consumer for meeting potential funders
  • Suggests marketing strategies
  • May conduct a feasibility analysis
  • May make recommendations on the viability of the proposed business

The consultant should have experience in developing business plans. Be aware, however, that this does not ensure that he or she will develop a realistic, quality plan. You should ask for an individual's or organization's credentials, interview past customers, and talk with local bankers or lenders. Counselors should not expect a consultant to rubber-stamp a business plan without explanation or involvement on the consultant's part. When asked to do this, a small business consultant may provide some feedback and recommendations, but will be concerned about his or her business' reputation and liability.

What Would You Do? A Case Example

The feasibility study indicated that Arnold was a promising candidate for self-employment; however, his disability and education level made written and spoken communication very difficult. Jo, Arnold's VR counselor, understood the importance of having the consumer take responsibility for writing his or her own business plan but she doubted Arnold's ability to develop a business plan. She did, however, believe that Arnold knew what he wanted to do, knew how to do it, and had the ability to do it. The ideas were in his head and he simply needed help in transforming them into a written plan so that others could see the merit of his proposal. 

Jo's schedule and state guidelines, did not permit the level of involvement she thought was needed in this case. Her solution was to recruit people from Arnold's support system, and hire a business consultant with whom she had worked before. Arnold's sister, Barb, agreed to assist Arnold and acted as a facilitator between him and the consultant. She sat in on Arnold's next meeting with Jo. At that time, Jo explained to both of them what a good business plan should include and suggested sources for gathering the information Arnold would need. Jo also explained that Arnold should provide the ideas and whenever possible, he should do the research himself and do his own writing of ideas and findings.

During the consulting interview, Barb helped Arnold draw out the key points of his proposal, the consultant recorded them and asked his own clarifying questions. Barb made sure Arnold understood the consultant's questions, and she made sure the consultant limited his role to only helping clarify and articulate Arnold's ideas. 

Together, Arnold, the consultant, and Barb were quite a good team. From Arnold and Barbs' materials, the consultant produced a concise and well-written document; Barb facilitated the flow of communications and supported Arnold in researching and writing when necessary. Arnold initiated ideas, did research and writing, and made decisions. Jo was satisfied that the resulting business plan met VR standards and very importantly, it was Arnold's plan.

Case Studies

Case 1

As a new consumer of VR services Celia came to her first VR meeting knowing she wanted to be self-employed as a dog groomer. Her feasibility study, which included the Beginning to Develop Your Business Plan questions, the Monthly Personal Living Expenses Worksheet, and the Business Assessment Scale, indicated she was a good candidate for pursuing self-employment. Although she was able to answer the preliminary questions about her proposed business her confidence flagged at the prospect of developing a complete business plan on her own. 

Understanding this apprehension, Celia's counselor, Ben, gave her a copy of the VR agency's business plan guidelines and an example of a good business plan. He explained that her community houses an organization that teaches people to develop business plans and that this same organization would work with her to develop her business plan. He gave her the organization's address and phone number. She contacted the agency, signed up for and completed the classes. Using the organization's library, the community library, other sources, and with guidance from both Ben and the business development consultant, Celia developed a viable business plan and a successful business. 

Case 2

Felicia came to her first VR meeting knowing she wanted to own an aquarium and speciality fish store. Like Celia, Felicia's feasibility study was positive and she displayed the same lack of confidence in her ability to develop a business plan. But in this case, Felicia's counselor, Carol, told her they could not go any further in the process until Felicia returned with a business plan. Felicia left without any further guidance. 

Determined to follow through, Felicia called her bank and visited the commercial loan banker who gave her a business plan outline and forms to complete but did not explain the forms or their purpose. The banker was very discouraging about how much collateral she would need and about the possibility of the bank funding her small start-up business. She worked through the forms as best she could and developed a plan that she submitted to Carol.

Carol said the plan did not meet the agency's criteria for committing to a business, but she did not provide an example of an acceptable business plan. Carol made two suggestions: that Felicia try again to develop an acceptable business plan, or that Felicia seriously consider another employment goal. Carol also expressed her opinion that Felicia did not have the capability to start or run her own business. Feeling defeated, Felicia took a job as a receptionist/office worker for an insurance agency.

Case 3

After a few meetings with VR, Habib reported to his counselor, Mark, that he had thought a lot about self-employment and thought that was what he wanted to do. He did not know exactly the kind of business he wanted to start but thought he might want to try publishing an newsletter for outdoor enthusiasts. Habib believed that because of his disability, a head injury, and because he had to stay at home to care for his ill wife, he could not work for anyone else, but that he thought it would work to be self-employed so he could determine his own hours. 

Mark had worked in the community for some time and had established a large network of contacts. Because this was how he had worked in the past with others who wanted to be self-employed and because Habib was reluctant to initiate phone calls to strangers, Mark began calling all the people he could possibly think of who could help Habib. He explained all about Habib to his contacts and set up meetings so Habib could talk about his idea. The contacts provided Habib with advice on how to open such a business, names of other people and organizations to contact, and suggestions for reading materials. 

Armed with all this information, both Habib and Mark were enthusiastic about the possibilities. Mark was ready to start following the leads, but he had been cautioned by one of the contacts to lay low and let Habib take control from this point on because this was to be Habib's business. Habib needed to start taking control because Mark would not be there after the business opened. This was hard for Mark to accept because he thought he was just assisting by opening doors for Habib. However, Mark respected the advice and explained why from this point on Habib would be expected to take the lead, but that he would be there to provide encouragement and suggestions when Habib needed them. 

Habib contacted some of the people. When some did not return his phone calls, he contacted Mark and complained, but would not make follow-up calls himself. He wrote for information on publishing, called the school to take a computer class but did not sign up, and got some of the books on developing a small business from the local Small Business Development Center but did not read them. After several meetings with Mark during which they discussed Habib's next steps and Mark provided prompts and encouragement, nothing changed. Mark told Habib it appeared he would not be a successful business owner and that they should start looking at other options. Habib subsequently found work as an editor for a local publishing firm. He was able to arrange part-time in-home care for his wife so he could work both at home and in the publishing firm's office.

Case 1 Discussion: Celia, the dog groomer, had everything going for her. She had initiative. Her counselor, Ben, facilitated the process by showing her what the agency expected, by giving her a copy of a good business plan to review, and by suggesting a resource in the community to contact. Celia contacted that agency, registered for and attended the classes it offered, and used the agency's resources to help her develop her business plan. By taking advantage of the agency's resources and guidance she educated herself and develop a strong business plan and ultimately a successful business.

Case 2 Discussion: Although she also demonstrated initiative, Felicia was not as fortunate. She worked hard to develop a business plan, but neither her counselor, Carol, nor the banker provided guidance on how to start a business. Even though she knew Felicia was apprehensive Carol's attitude of "If she is qualified to run a business, she will figure it out" helped set Felicia up for failure. Felicia's attempt to develop a business plan was punished by Carol. In a different situation, it is likely Felicia would have succeeded.

Case 3 Discussion: Mark was doing what he had done in the past to help someone be self-employed. Mark began the process with Habib in tow, but later when told that it was best for Habib to control the process, Mark retreated to the role of advisor, supporter, and liaison. However, Habib did not take initiative or complete the activities needed to develop a business plan. After realizing Habib's inability to take initiative or complete activities necessary to develop a sound business, Mark suggested it was time to look at other options.

Chapter 5 Study Guide: Who Does What in the Process?

  1. The _________ develops the business plan.

  2. Three of the main functions of the counselor in the self-employment process are ____________, ______________, and _________. 

  3. The counselor must be able to read and understand a business plan because in most cases he or she:
    a. Reviews the final business plan
    b. Evaluates the business plan to determine if the agency will or will not support it
    c. Determines the agency's contribution
    d. All of the above
    e. None of the above

  4. Consumer initiative and ability to complete the steps in the self-employment process are indicators of potential success. True_____  False______ 

  5. In most cases consumers should (work with a consultant/work on their own) to develop a business plan.

Study Guide Answers: Chapter 5 - Who Does What in the Process

July 1998, 1st Revision June 1999, 2nd Revision February 2001