Survival by numbers - small business marketing for changing demographics - Cover Story

William Dunn

Hours before dawn five days a week, Mark Kominkiewicz begins making house calls in an upscale Chicago neighborhood. Except for that one time that he was mistaken for a prowler, people are delighted to know he's there.

He's their milkman, a 1990s reincarnation of a breed that had become virtually extinct because of competition from supermarkets and convenience stores.

Kominkiewicz, 25, had a job as a financial analyst, but he grew tired of office routine and decided he wanted his own business, so he started his Lincoln Park Dairy Service. He operates the delivery route, and his partner, Paul Yeh, manages the office. "Our appeal is on many levels--convenience, freshness, concern for the environment, and nostalgia," Kominkiewicz says. He began with 30 customers after do-it-yourself marketing research convinced him that there would be enough demand to launch a milk route. He now has 200 customers and is shooting for 1,600 by year's end.

The Chicago milkman says many of his customers are working couples with no children. Others are parents juggling careers and children, with little time or energy left to shop.

About the time that Kominkiewicz is wrapping up his morning deliveries in Chicago, a team of editors in Boston is reporting for work on the next issue of Investment Vision, a bimonthly magazine orginally targeted to clients of mutual funds but now aimed at a larger although more sharply defined audience. "It's written for maturing baby boomers," says Jaime Bernard, marketing manager. "We feel we're occupying a niche in the marketplace that really hasn't been filled."

That market consists of America's biggest generation ever, the baby boomers, whose leading edge is now moving into middle age and grappling with such financial concerns as retirement planning, long-term health care for themselves and possibly for aging parents, and financing their own children's college educations at cost levels they had not anticipated 18 years ago.

Across the country in the booming suburb of Milpitas, Calif., yet another supermarket opens this month, but this one is different. Unlike its competitors, the Lion Food Center stocks a vast array of Asian foods and products.

"Our store is like a combination Safeway and a store you find in Chinatown," says David Tran, general manager of the family-owned market. This is the second such supermarket for the Tran family, which immigrated from Vietnam a decade ago.

The Trans are among the millions of newcomers who are making Asians the fastest-growing minority group in California and in the U.S. The family opened its first Asian market in San Jose in 1986. The business now employs 65 people and grosses $10 million annually. Tran notes that some of his mostly Asian customers make four-hour round trips by car to shop in his market.

Although Kominkiewicz, the staff at Investment Vision, and the Tran family are in sharply different businesses scattered across the country, there is a common denominator to their decisions to launch their respective enterprises--the changing demographic patterns that are reshaping U.S. society and markets and challenging small-business people to alter their strategies to keep up or risk being left behind.

Vincent Barabba, former director of the U.S. Census Bureau and now General Motors' executive director of marketing research and planning, says that demographics "can offer the competitive edge."

But you don't have to be General Motors to use--or to need--demographics to stay on top or to catch up. "Demographics has a big place in small business," says engineer Irwin Friedman of the Network of Small Businesses, a professional association of small firms, based in the Cleveland suburb of Lyndhurst. "Trend tracking can certainly give small business the edge," he says, "because the turnaround time is more rapid for a small business than a large one. The adjustment to reality takes place very quickly."

On the other hand, businesses that ignore population and market trends are "flying blind," Friedman says. "Unless they're lucky, they're gone in a year or two."

Small businesses that find the term "demography" too technical might be more comfortable with its definition--the science dealing with characteristics of human population. From the business perspective, some compare a demographic trend to a train: You have to find out where it's going and decide early whether to get on board; if you wait until the train is roaring down the tracks and gathering momentum, you've already missed it.

Demographics can spot and quantify trends in how we live, work, and play. And a gold mine of new demographic data is available in the findings of the 1990 Census. The latest population count shows, among other things, that the U.S. is becoming older and more racially and ethnically diverse.

Asians are the fastest-growing group, but Hispanics will likely surpass blacks around 2015 to be the largest minority. Labor shortages are developing in some sectors. Marriage is on the upswing, and divorce is leveling off. We're moving ever farther from the central cities, yet we're getting closer to water.

Those are just a handful of the myriad demographic details that will have an impact on business decisions into the coming century.

The importance of demographics started becoming apparent to the business world in the mid-1960s, Friedman says, when the U.S. was hit by the so-called "baby bust"--the plunge in the number of births. For 19 years before that, the postwar baby boom fueled expanding markets for everything from diapers, bluejeans, and portable classrooms to sports cars, mortgages, and starter homes. Businesses had difficulty keeping up with demand and little time for planning. Many people just assumed that growth would simply continue.

Then came the birth-control pill, liberalized divorce, and new attitudes that saw women launching careers and postponing motherhood. After having peaked at 4.3 million in 1957, births had dropped below 4 million a year by 1965. Many dismissed the drop as an aberration. But the free fall lasted through 1976, when births bottomed out at 3,168,000. Many firms were caught off guard, as markets stopped growing or began contracting. Competition became fierce; to grow now meant taking business away from rivals or diversifying.

In effect, demographic analyses come down to relationships--the present to the past, and the combined past and present related to the future. "To know where you're going, first you have to know where you've been," says Peter Bounpane, assistant director of the U.S. Census Bureau.

Here's where we've been lately: The United States grew by 22.2 million people from 1980 to 1990, gaining almost as many fledgling consumers and future workers as the entire population of Canada right now. But there's a flip side. The 9.8 percent growth rate--also equal to the potential growth rate of the market for consumer goods and services--was the second-slowest in 200 years. Only the Depression decade of the 1930s was slower.

The Sun Belt is still growing, yet there are pockets of slow growth or no growth in some of those states. Nationwide, jobs as well as individuals are going to the suburbs, where new cities are emerging. Many old, central cities continue to lose people. Yet New York and some others reversed the slide and actually grew, thanks to immigration. Without continuation of the new wave of immigration now under way, the total population could actually begin shrinking in 50 years.

Births in 1990 hit a 27-year high--demographers call it the "echo baby boom"--but experts say it won't last long.

For small-business people, these and other demographic trends evolve into specific challenges dealing with changing consumer preferences, marketing strategies, business locations, and the availability of workers.

Here are details on demographic developments of top concern to business and examples of how innovative entrepreneurs have adapted to benefit from them. These accounts should give you some ideas for making the most of demographic developments for your own business.

The Original Baby Boomers

They've been described as a "pig in a python," the big bulge that has been moving through the age brackets of the U.S. population in recent decades. They are the 76 million Americans of the original baby boom, born from 1946 to 1964. They now represent 31 percent of the U.S. population.

Many boomers grew up living for the moment, listening to blaring rock music, trying to save the world, and not trusting anyone over 30. Now, those born in the boom's first five years are in their early to middle 40s, the substantial number born in the 1950s are "thirty-something," and the youngest of the boomers are in their late 20s. What most have in common today is an interest in fitness, finances, and the family.

Changing Priorities "The baby boom now has children to protect," says Cheryl Russell, an author on population trends and an authority on that generation. "They've become cautious. They've always been self-centered, and now they have extended that to their children, families, and home."

Russell, herself a boomer and author of 100 Predictions for the Baby Boom, (Plenum; New York City) writes in her book: "The home will symbolize the social stability of the next few decades. It will be the center of American life, equipped with VCRs, home computers, compact-disc stereo systems, cable television, large-screen and pocket-sized televisions, security systems, answering machines, microwaves, exercise equipment, and a host of new technologies not yet on the drawing boards. Middle-aged consumers, short on leisure time and busy raising children, will spend more time at home. The businesses that catered to the young adults (such as singles bars, Laundromats, and ski resorts) will have to change their strategies."

Clearly, it's good news for home remodelers and contractors, for makers and marketers of electronics products, and--because appearance-conscious boomers are graying at the edges and beginning to bulge--welcome news too for fitness clubs and makers of exercise equipment.

Although the home is becoming an electronic castle, buying the home of their dreams is increasingly tough for couples. Thus many are staying put in their present homes and expanding and remodeling.

Seeing an opportunity there and wanting to go "into a different gear," John Lorenz last year left the vice presidency of a 50-person architectural firm to launch Weekend Projects Inc., in a suburb of Washington, D.C. Unlike other contractors, he works alongside homeowners. "We provide the extra pair of hands and the technical skill," says Lorenz. Customers complete the project for less money and get the satisfaction of building their own dream houses.

The health-conscious among the boomers, who gave birth to the environmental movement, are now increasing the demand for--and the sales of--more natural and less processed foods, everything from high-fiber cereal to low-fat ice cream. And the trend is spilling over to children of boomers.

Family Patterns While boomers have been slow to start families and are having small ones, they're now eagerly shopping for their young children. Yet the fact that they're having small families doesn't mean they're spending less than parents did a generation ago. Rather, it means boomer parents can afford to spend more on each child.

The boomer parents' purchasing patterns also extend to clothes. "Married couples with kids are spending as much on clothes as couples without kids," says Russell. "But those with kids are spending it on children's clothes. This is a shift in priorities that a lot of businesses are not yet aware of."

Currently, boomers are having an average of about 1.8 children per couple, down from the peak of 3.7 in the mid-1950s. Yet the U.S. is now in the midst of a temporary "echo baby boom." Births have been rising for the past several years, and they reached 4,179,000 in 1990--the highest total since 1963.

This echo boom, which began just after the baby bust, is being fueled by the women who were born in the original baby boom. Having postponed marriage and motherhood to launch their careers, they now are having children, racing against their biological clocks. Even though they're having small families, there are so many of these women that they have caused a jump in births. The boom will be short-lived, however, because these women will soon begin moving beyond their childbearing years.

Nonetheless, the echo boom will be another ripple for smart marketers to follow through the life cycle with age-specific goods and services.

Walk, Don't Climb Meanwhile, the travel and holiday industries are scurrying to adjust to the demands of the aging boomers, with their busy schedules and busy offspring. At Mountain Travel, a pioneer in adventure travel, its president, Richard McGowan, says the company has "grown over the years by segmenting, by having something available as the baby-boom generation moved into maturity. It might not be a strenuous trip to the peak of the Himalayas, but four days trekking in the lowlands where you get the flavor of the whole thing." McGowan's company, in El Cerrito, Calif., just acquired another firm, which will offer more and shorter domestic adventures, such as shooting the Colorado River rapids. Sales are expected to reach $12 million this year, up from $2 million a decade ago.

Although many boomers are in their middle years, their ears are tuned back a few decades. Nostalgia is hot, especially in music. More than 1,150 U.S. radio stations--12 percent of the total--now spin mostly oldies or "classic rock," double the number five years ago. One of the latest to switch is WLCL-FM, in Gainesville, Fla.

"The music is totally classic rock 'n' roll--'60s through the '80s," according to Mike Jurian, WLCL disc jockey and general manager. "You have to look at the demographics: Seventy-three percent of the [metropolitan Gainesville] population is between 18 and 49. The most desirable demographics to go after, in most cases, is usually 25 to 54, because you're looking for those qualified buyers who have money, college education--the yuppies."

While they dial back in time for their music, boomers are also thinking about their own futures--if belatedly. They're juggling the expenses of childrearing and the pressing need to start a nest egg for retirement, which may come before age 65 because of the growing volatility of the job market. Banks, brokerage houses, and independent financial planners and accountants are all rushing to serve this vast boom market with annuities, mutual funds, insurance policies, and growth stocks.

The boomers are strapped for cash now, but that may change. Marketing expert Ken Dychtwald of Age Wave, an Emeryville, Calif., firm that advises business and government on the implications of an aging population, notes that the boomers' own parents were thrifty and saved, and they realized tremendous appreciation on homes bought in the 1950s. "People 65 and older own $3 trillion to $4 trillion in wealth and assets," he says. "Many are going to be passing on. And you'll see $3 trillion to $4 trillion in cars, insurance, stocks, and homes come cascading down to the boomers."

After knocking themselves out in the 1980s advancing their careers, many worn-out boomers will be easing up on their grueling work schedules in the 1990s and rediscovering the joys of hobbies.

"Instead of going to the office Saturdays or staying late Thursdays, they're carving out three- or four-hour chunks for piano lessons, gardening, or cooking school," says Peter Moore, a managing partner of Inferential Focus, a New York City firm that performs market analyses for clients.

Peter Dickinson, 64, semiretired in Prescott, Ariz., has almost 100,000 subscribers for his Retirement Letter. His readership is getting younger and includes many boomers; one reader is 30.

City Dwellers March To The Suburbs

It's 8 in the morning. Stores and offices on the tree-lined suburban streets of Troy, Mich., are open for business, and the traffic is heavy. The commuters are on their way to jobs at K mart's headquarters, or the Volkswagen corporate offices, or the upscale Somerset Mall, or the hundreds of small companies tucked away in landscaped office parks.

"When we moved here 15 years ago, this was a fairly rural community; we were on the edge of suburbia," says Norma Machado, an executive with a group-insurance firm.

Once a town in the middle of farmland, Troy has mushroomed into a major employment center with more than 109,000 jobs--and the traffic congestion to go with it. "And they're still building," Machado says. "But the roads haven't been expanded to accommodate the growth." Though she lives only a mile and a half from her office, Machado's drive to work sometimes takes 15 to 20 minutes.

About 10 miles away, Detroit resident Anthony Johnson, who doesn't have a car, hops into a 15-passenger van for the commute to his suburban job. "Inside the city of Detroit, there are not many full-time jobs," says Johnson. "There are lots of jobs in the suburbs, umpteen million. The problem is getting to them. The van solved the problem for me." Suburban employers partly subsidize this and several other area vans. Riders from the city pay modest fares.

Welcome to suburbia of the 1990s, the new address to work as well as live. "The suburbs are no longer |sub' to the |urbs,'" says University of Miami geographer Peter O. Muller. Across the United States, the traditional metropolitan configuration of one dominant central city is giving way to what Muller describes as the "pepperoni pizza," in which several suburbs within a metropolitan area evolve into major job centers.

In addition to Troy, such centers in the metropolitan Detroit area include Southfield, Novi, Sterling Heights, West Bloomfield, and Auburn Hills, all competing with one another as well as with Detroit.

The same development is occurring in Fairfield County, Conn.; Tysons Corner, Va.; Gwinnett County, Ga.; Naperville and other northern Chicago suburbs; the corridor between Seattle and Tacoma, Wash.; Houston's Galleria area; Mesa, Ariz.; and throughout Southern California into the desert.

From 1980 to 1990, nonagricultural employment in the United States grew by 19.9 million, reaching a total of 110.3 million workers.

Economist Nestor Terleckyj, who does job and population projections for NPA Data Services, in Washington, D.C., calculates that 64 percent of those new jobs were created in suburban counties, 24 percent in central-city counties, and 12 percent in nonmetropolitan or rural counties.

Why so many new jobs in suburbia? Terleckyj cites the highway network, proximity to regional airports, and affordable, wide-open land that can be developed from scratch. Also, it's where a growing majority of people--and therefore workers--live.

The Growing Suburbs Troy, an attractive new suburb of landscaped office parks and moderately priced to expensive homes, is 16 miles north of the Detroit River, just off Interstate 75, which reaches all the way to southern Florida. From 1980 to 1990, jobs in Troy grew 67 percent, according to the Southeastern Michigan Council of Governments. That's over three times the U.S. growth rate. During the same period, the city of Detroit lost 104,000 jobs, or 21 percent of its total employment.

Jack Butler, whose computer-graphics firm outgrew its original location in his Detroit home, moved the business to Troy four years ago. "Our customers were out here, and we couldn't find any safe place in the city to put a quarter of a million dollars' worth of equipment," says Butler. He's satisfied with Troy, except for the rush-hour traffic. "There is real gridlock, but we |flexed' our hours to avoid it."

The evolving suburban economy in Troy, as elsewhere, is a mix of services, light manufacturing, and retailing. Many retailers cater to the hectic suburban lifestyle of the 1990s: VCR rentals, computer stores, gourmet shops, malls, and a culturally diverse mix of restaurants.

Yet Troy, like other suburban cities, has no traditional downtown and very few sidewalks. Unless they brown-bag it, workers must commute to lunch. When the clock strikes 12 noon, people reach for their car keys, unless, of course, they call Door 2 Door.

"They just give us a call, and they get their favorite restaurant meals delivered to them," says Bob Berriman, a manager at Door 2 Door. Started two years ago, Door 2 Door has about 60 employees shuttling lunch and dinner from dozens of restaurants to offices and homes in 12 Michigan suburbs for the price of the meal plus a $2 service charge and a gratuity.

While America's suburbs offer employers less crime, red tape, and bureaucracy than many central cities, the emerging suburban cities are not without problems such as urbanization, demand for expanded municipal services, tax increases to pay for them, and intense competition among the suburbs for tenants, who freely hopscotch from one office park to another when leases run out.

Troy, with an upscale residential population of 73,000 and a work force of 109,000, still operates with a volunteer fire department. The town's 50 baseball diamonds are in such demand by Little Leaguers and corporate teams that many games are played under the lights, and lotteries are held to decide which corporate teams can use the fields.

The Mileage Gap Mass transportation offers only modest hope to the sprawling suburbs' traffic and transportation problems. Mass transit worked well when almost everyone headed each morning to offices and factories in the downtown of central cities. But "metro areas have been turned inside out," says geographer Muller. Buses and trains are having an increasingly hard time bringing workers and shoppers to businesses scattered throughout a metropolitan area. The automobile becomes almost essential, and the lack of a car becomes an obstacle, especially for inner-city residents who desperately need work.

Voicing a common complaint of many urbanites, Anthony Johnson observes: "If you don't have a car, you can't work that job."

In high-cost suburbs such as Fairfield County, Conn., Princeton, N.J., and vast parts of Southern California, there is the added problem that many clerical employees and other lower-paid workers cannot find affordable apartments anywhere near their jobs.

In Southern California, those working in Orange and Los Angeles Counties have gone a hundred miles into the desert to find affordable housing. This has given rise to the desert community of Moreno Valley, one of the nation's fastest-growing towns during the 1980s.

In the New York area, the daily commute is two hours each way by car or bus for the hundreds of workers whose jobs are in the city and who live in Pennsylvania's distant Pocono Mountains.

In the Detroit area, the Southeastern Michigan Council of Governments runs a telephone hot line to match up people in car pools in hopes of getting them to work. And the transit authority has changed some bus routes, with limited success. Employers too have responded by working with various contractors and entrepreneurs to run shuttle van services to and from work.

Entrepreneur Dan Williams Jr., who runs a garment business in Detroit, three years ago launched Jobs Employment Transportation Services (JETS). Working with suburban employers, he recruits city residents and then transports them to work in a fleet of 15 passenger vans. "Every time I travel out of the city, I find |Employee Wanted' signs all over," Williams says. "And I'd come back to Detroit and find tons of people who had no jobs. I said, |Let's see how we can solve this.' We put the people and the business together."

The experiences in suburban Detroit are being repeated throughout the United States. Hundreds of entrepreneurs like Williams have popped up in city after city to shuttle people to suburban jobs. Some 15 percent of the work force now operates on flextime, which permits workers to choose their starting times for work within a certain range. This in turn spreads commuting into off-peak hours.

To encourage ride sharing, many businesses save the closest parking spots for car pools and van pools. Varian, a Silicon Valley computer firm, raffles off vacation trips for those who use alternative transportation.

Work-Force Diversity

The push to suburbia has clearly been at the expense of battered central cities such as Detroit. Among those leaving for the suburbs are growing numbers of middle-class black families. Left behind in the cities are poor minorities and older whites, along with new waves of immigrants, primarily Latin and Asian.

Central cities, despite whatever crime problems they may have, are responding by touting themselves as mature cities with the infrastructure and historic office space available at favorable rents.

Those cities are also magnets for many immigrants, gravitating to where rents are cheap and their countrymen already have a foothold. After they arrive, they set up mom-and-pop businesses, and, in the immigrant tradition, they get the whole family working and turn a profit on a shoestring. Often, they cater to other immigrants in their particular ethnic community.

It can be tough competition for long-time merchants, and there have been clashes. But immigration is helping re-populate and re-energize many central cities.

At the Devon Bank on Chicago's North Side, for example, service is offered with a smile and in any of 30 or more languages, if necessary. "It's made me brush up on my English," jokes the bank's chairman, Richard Loundy. "I find I don't use a lot of slang, so I'm not misunderstood."

As recently as the late 1960s, the bank's staff was entirely white. Now 10 percent of its 124 employees are black, 6 percent are Hispanic, and 19 percent are Asian. One-third of the employees are foreign-born, and 65 percent are women. "We have our own little melting pot right here," says Elizabeth Soter, the bank's senior vice president. "This happens to be a very diverse area." Once mostly Irish, German, and Jewish, the neighborhood has become increasingly Asian, Hispanic, and East Indian.

Like North Side Chicago, America too is becoming ever more diverse racially and ethnically. And the growing diversity of the work force will pose challenges and opportunities for business.

"You have to adjust to accent and lack of English ability until it develops," says Loundy. "We've given courses here--English as a second language. And you may have to adapt your training to cover [employees'] lack of information on your industry."

The bank's diversity has been good for business, Loundy says. "Employees will bring in their friends and relatives, saying, |This is a good bank; I work here.' We get good customers that way."

Not only must workers adjust to their work environment, but also smart business executives must learn the ways of their changing work forces and neighborhoods. One Chicago banker lost a Korean depositor's account after making a friendly beckoning hand gesture to the depositor--a gesture that is decidedly rude to Koreans. The Korean transferred his business to Loundy's bank.

The growing diversity of the work force reflects changes in the overall population attributable not only to immigration but also to the higher fertility rates among some groups. From 1980 to 1990, when the U.S. population increased 9.8 percent to 248.7 million, whites grew by 6 percent while blacks increased 13 percent, Asians, 107 percent, and Hispanics, 53 percent.

Between 1980 and 1990, net immigration accounted for about 30 percent of population growth. That share will likely grow in coming years as the population ages and as growth attributable to births slows still further. Without substantial levels of immigration, Census Bureau projections show, the U.S. population actually will shrink after the year 2040. A shrinking population would mean a shrinking economy and a smaller work force.

Unlike times past, when immigrants were mostly European, three-fourths of today's immigrants come from Asia and Latin America. More U.S. immigrants come from Mexico than from any other country.

In Outlook 2000, a 1990 report from the Labor Department's Bureau of Labor Statistics, it is forecast that by the year 2000, blacks will account for 12 percent of the work force, Hispanics, 10 percent, and Asians, 4 percent. By 2000, women will make up 47 percent of the work force, although many of them will be working part time, juggling jobs and family responsibilities.

At the same time, the pool of young workers ages 16 to 24--the primary source of unskilled, low-wage help--will drop to 16 percent of the work force by 2000, down from 24 percent in 1976 and 20 percent in 1985.

The growing number of women workers presents its own challenges. Since many have children, that will increase demand for child-care services as well as part-time, job-sharing, and flextime schedules. (By 1988, one-fourth of all female workers had part-time jobs. The rate rises significantly for women with preschool children.)

Flextime is a way of keeping an office functioning over a larger span of hours than would be possible if all employees worked the same hours. Part-time workers can reduce company overhead because they typically do not receive medical or pension benefits.

Look for more older employees, many of them semiretired, to take part-time work as a way to keep active and to supplement their incomes. This is one way to counterbalance the deepening shortage of young, low-wage workers. While McDonald's, for instance, has certainly made effective use of older workers at its restaurants, one of the first companies to hire older workers was Fertl, a small potting-soil firm that a retired engineer in Connecticut started in his garage in the 1970s. After having difficulty finding dependable young workers, he turned to seniors, who proved productive, dependable, and content to work for the minimum wage.

Yet workplace diversity can present problems. As the labor force becomes more diversified, employers need increasing numbers of workers for technology-based jobs that require skills lacking in many immigrants--and in many native-born Americans who attended public schools.

In response, companies large and small across America are going directly to the schools, getting involved in course design, career counseling, and mentoring programs. "They're looking for a better product, a graduate that's prepared for the business world. They're becoming a full partner in our schools," says Brian Cram, school superintendent for Nevada's Clark County, one of the nation's fastest-growing school districts. Some 30 local businesses, ranging from high-tech companies to shopping-mall retailers, are involved in Clark County schools, which serve metropolitan Las Vegas, now seeing an influx of companies from California.

Even in the basic trades, employers increasingly are becoming educators out of competitive necessity. "Now, more and more, you find motivated, intelligent individuals that you simply are going to have to train," says Dick Maresco, vice president for education at Washington-based Associated Builders and Contractors, which represents 17,500 construction firms. They are "now having to teach basic math, even give reading tests as a qualification for training," Maresco says. "Unfortunately, we're having to do the things we hoped the schools would do."

The association offers its members training manuals in various building trades and in basic math.

Although diversity will put added training burdens on employers, the new workers will give employers an extended range of resources to deal with change not only at home but also in the global markets that increasingly affect American businesses. "We figure we're the bridge between the United States and Latin America," Hector Barreto of the Hispanic Chamber of Commerce says of the organization's member companies. "We not only speak the language, we also understand the ways of business."

The Pacific Rim countries already constitute a major force in world trade, and Americans of Asian descent will make important contributions to U.S. employers doing business with that formidable economic bloc.

The same principle applies to other ethnic groups: America's best trade representatives of the future may well be working today in the plants, offices, and shops of small businesses.

The demographic factors that expand the horizons of business leaders such as Hector Barreto and spark entrepreneurs such as milkman Mark Kominkiewicz and grocer David Tran are far removed from the days when business first began to recognize the extent to which population factors could pose both problems and opportunities.

The pioneers included Gerber Products, the baby-food maker based in Fremont, Mich., which used a somewhat primitive form of demographic research 60 years ago. When Gerber entered a town in the 1930s, the company's representatives would count the houses with diapers on the clothesline before calling on local merchants. They used the diaper count to show retailers the potential market for Gerber products.

David Tran's description of his own business sums up the key factor that all entrepreneurs must keep foremost in mind as they seek ways to benefit from demographic change:

"We fill a need."

PHOTO : Patricia DiMaria of Chicago's upscale Lincoln Park neighborhood is among the customers of the home-delivery service that Mark Kominkiewicz provides.

PHOTO : Disc jockey Mike Jurian, left, at an event sponsored by his Florida station, says that demographics dictate his "totally classic rock 'n' roll" format.

PHOTO : Trekking in the lowlands is becoming more appealing to maturing baby boomers as an alternative to mountain climbing.

PHOTO : Richard McGowan, second from right, president of Mountain Travel, and his staff track demographic changes as part of their strategic planning.

PHOTO : Racial and ethnic diversity in his work force helps bring in new customers, says Richard Loundy, chairman of Chicago's Devon Bank.

PHOTO : "The center of American life" will be the home, says author Cheryl Russell, at home in Ithaca, N.Y., with husband Rick Eckstrom and son Sky.

PHOTO : Contractor John Lorenz works alongside homeowners in a Washington suburb, helping them build their dream houses.

PHOTO : Dan Williams Jr. started an employee commuter service in Detroit to match suburban jobs and city dwellers looking for work.

Washington, D.C.-based writer William Dunn is the author of the Layman's Guide To Demographic Information, to be published in early 1992 by American Demographics Books, Ithaca, N.Y.

COPYRIGHT 1991 U.S. Chamber of Commerce
COPYRIGHT 2004 Gale Group