View Resource

WORK AS A PRIORITY - Issues Brief #5: Self Employment and Social Enterprise Planning

Available formats:    Word   |    PDF


Individuals who are homeless with psychiatric disabilities face high unemployment rates, discrimination arising from stigma, and a paucity of supports (such as rehabilitation and medical care).  For many of them, business ownership is a feasible and promising approach to maximizing existing resources such as Social Security Income (SSI) benefits, Vocational Rehabilitation (VR), Workforce Investment Act (known as WIA or One-Stop Center) services, and community economic development assistance, such as no-cost help from local Small Business Development Centers (SBDCs) ( Self employment, with a success rate of approximately 79 percent, is the fastest growing career option today in the U.S.

Self employment presents a unique opportunity for individuals in this circumstance, especially since many of them exhibit street-smart creativity, resilience, and a strong survival instinct. While challenges such a poor credit history, a paucity of up-to-date technical skills, learned dependence, stigma, the functional impact of disability, and fear of the loss of benefits pose significant barriers for many of them, the opportunities often outweigh the risks:

Self employment presents one of the very few ways a Social Security Income (SSI) recipient can amass savings. The Social Security Administration (SSA) work incentive, Property Essential to Self Support (PESS), frees business owners from the $2,000 resource limit for wage job holders. A successful enterprise allows owners to purchase many of their own supports, thus emancipating them from the system.

Microenterprises can often be started with minimum investment.

Larger operations can qualify for funding through VR or through a Plan for Achieving Self Support (PASS) from the Social Security Administration (SSA). They can also apply for specialty loans through such sources as the Small Business Administration (SBA), city and county governments, and the Veteran’s Administration.

The transition from homelessness offers an opportune time for the consideration of business ownership. At this time, the case manager (who is typically involved in coordinating housing, medical, and mental health services) can help interested clients by  making the connection to the nearest Benefits Planning Assistance and Outreach (BPAO) office (, applying to VR and the local One-Stop for training and career support, and analyzing the impact of income on various medical and housing benefits. This brief will provide detailed guidance on how to support clients who are interested in exploring self employment.


Self Employment Strategies for Individuals

Getting Started

Getting started in self employment is often the most difficult step. Too often people with significant disabilities are guided into menial jobs. All humans are complex, so a method of “discovery” is required to ferret out a host of interests and possibilities. Discovery, a process developed by Marc Gold Associates, is a structured community assessment that involves getting to know an individual in a variety of community and work environments in order to understand his or her ideal working situation, gifts, and talents.  Rather than emphasizing the use of typical vocational assessments, this approach involves “living into the answers” by reviewing a person’s past work history, education, major life themes, dreams, and ambitions. Then, the coordinator creates a functional plan that sometimes includes visits to others following similar career paths. VR and One-Stop support for paid work experiences, functional community assessments, or business feasibility studies can all help determine the best path for career development.

Case Example:
Janine’s Pet Supply Company

Janine displayed several challenging behaviors while working in short-term paid jobs that fit her interests, and her attempts at returning to college resulted in frustration and anger.  Due to the level of support necessary in a wage job, she decided it might be best if she started a business of her own. VR helped her purchase needed equipment, and a U.S. Dept. of Labor project provided business development assistance. Within a couple months she was operating a successful pet supply company. Ownership of the company changed her relationships in the workplace. Instead of having a boss “ordering her around,” she now had customers giving her money in return for her efforts.

The trust arising between the individual and the case manager can grow remarkably fast when the individual is supported in creating his or her own career path. In conversations with over 50 business owners with disabilities, the authors of this brief discovered that listening and giving hope were the most motivating factors in attempting an enterprise. Skilled case management is the front-line resource needed to guide people gently through tough decisions.

Documenting the Plan

Once an idea is refined, the next stage is assembling the various business components (e.g., financing, possible technical training, and testing the idea). Free business development assistance is available through many sources, such as those on the text box above. Research is conducted by the individual and the case managers or support team, guided by the flowchart that follows. Once the required information is collected, it is written up using the locality’s approved business plan template by the prospective business owner, friends, mental health or business professionals, a contracted writer, or some combination of these.

Such a business plan is generally required in order to receive funding from state VR agencies and from the SSA if a Plan for Achieving Self Support (PASS) is used. Microenterprise loans and venture capital funds also require a thorough business plan as proof that the business is a good risk. For the individual, a plan is useful for predicting the impact of impact on public benefits, anticipating income and expenditures, and preparing to meet future business and personal obligations.

Product and Service. The plan begins with a precise statement describing the Product or Service, followed by an examination of the market environment and location. This statement includes information regarding the market for the product and where it will be sold, which should support a statement of specific reasons the business will succeed. This section also includes a short assessment of the person’s situation and support strategies, talents, love for making the product or delivering the service, and why this business makes sense for this individual. It should also note the availability of SSA Work Incentives. The examination of the feasibility of the project will draw on the market data collected. It will also clarify the tasks the owner will undertake and how he/she sees the business growing (that is, its potential).

Case Example:
Jim’s Upholstery Shop

Jim’s father taught Jim the family business of custom upholstery but Jim’s schizophrenia and auditory hallucinations resulted in his estrangement from the family. Now living 500 miles away and recently supported by the local Community Mental Health Center in a one-room cottage with a garage, Jim considered opening his small shop. Staff from a local U.S. Dept. of Labor employment grant project, along with his case manager and treatment team, surveyed local upholsterers, antique shops, and other potential customers regarding the need for high quality upholstery. Findings demonstrate a need for this type of business.  Equipment was secured through the grant project with a matching amount from the local VR office. Jim opened his business, concentrating on antique, high quality furniture. This narrow market niche allowed him to charge premium prices, maintain his therapy schedule, and work alone without regard for the impact of active symptoms. The project combined his housing with his business, reducing overhead costs and allowing him to earn a living wage. Jim’s case manager continues to provide outreach and assistance with the activities of daily life.

The 3 Cs: Customers, Competition, and Capabilities.  This section of the plan documents the business’s potential customers:

Who are they?
Where are they found?
Why would they buy this product/service?
Are they one-time buyers or will they want/need more? 
Is price a consideration for them?
What quality of product/service do they expect?
What level of customer service will they require?

The evaluation of the business’s competition follows:

Who is the competition?
Will it be easy for another competitor to enter the market with a similar idea?
Will the business compete on price, quality, or both?
Is there a plan to turn competitors into partners or suppliers of needed parts/services?

The capabilities of the business are summed up by posing a series of questions emanating from the Customer/Competitor analysis:

How many customers can we potentially reach?
How many repeat customers will we have?
Will our competitors supply us with raw materials or component parts? Can we supply them with finished items or sub-assembly work?

Exploring these questions thoroughly is important; answers may point out potential problems or weaknesses in the initial business design, illustrate positive market trends, and reveal capacity needs (e.g. retail sales require the business to invest in display cabinets, credit card capacity, shipping and inventory space). Much of this information is collected during the feasibility study (see Product and Service above).

Marketing Mix. This portion of the plan expands on the information collected about customers, competitors, and capabilities. Based on this information, the target market and the business’s niche are clarified, tactics to compete are considered, and the scope of the business is refined (for example, plans to expand from to additional sites or offer goods via the Internet).

Pricing is determined not simply by the labor and materials used in producing the product. The price also includes burden costs such as salary and benefits, rent, legal fees, business licensing, insurance, shipping and handling, tooling and equipment, communications, advertising, depreciation, and other fixed and variable costs. There is also a psychological aspect to pricing. Some customers seek bargains, but others insist on higher-priced name brands. The same customer may do either depending on the goods to be purchased. Knowing the market helps determine the price.

Distribution and promotion encompass where and how customers get the product, as well as the methods used to attract customers (i.e. networking, advertising, sales, marketing). Distribution planning includes determining the boundaries of the sales territory, if any; developing shelf space; deciding on the form of delivery; and describing the approach for reaching the customer. Promotion refers to the method used to advertise and market the goods or services. Most small enterprises use word-of-mouth (networking) to advertise and supplement that activity with Web sites, guest appearances on local radio shows, press releases to the business editor of the local newspaper, Yellow Pages listings, and the occasional radio or print ad.

Operations. This phase of planning concerns production of the product or service, including the use of appropriate business processes and support strategies. Listing the tools and equipment necessary for production is an essential component here. Suppliers must be secured and training for the business owner and any employees arranged.

Contingency plans are also necessary in the Operations section. If a supplier is unable to deliver the product component or tool, alternative suppliers should be known. If the business is seasonal (for example, a tourist-related service), a plan should be outlined to ensure the business does not falter in “down” periods. There should also be a discussion of equipment repair plans. The contingencies do not have to take into account everything that could possibly go wrong, but some thought must go into how any potential interruptions in business that could reasonably be anticipated would be handled.

Financial Plan. This section is perhaps the most critical one to develop and manage. Here the Benefits Analysis is merged with available funding, and the long-term estimation of income and expenses is developed (usually for 2 to 5 years out). Cash on hand and assets available to the project must be identified, along with any investors and loans. Typically, the business develops an operating budget and a cash flow projection, with a break-even analysis that illustrates when sales income exceeds expenses, and a Plan for Achieving Self Support (PASS) if applicable. Funders want to see an analysis of resources that shows the company will be profitable in a reasonable amount of time and that the operator will make money.. All the necessary forms are available through the local VR office, Social Security, and the local SBDC.

The PASS Plan  may be written at this point, or sooner if the business idea is solid and the benefits analysis is positive. A PASS is a valuable SSA work incentive that allows an individual to maintain a cash benefit while also banking additional cash from SSA for use towards achieving a career goal. Sample PASSs are available for viewing at; additional information is available at PASS provides cash to a business owner, something almost no other system can provide, and requires at least an 18-month business plan projection before approval. PASS can buy such things as starting inventory, vehicles or repair, equipment or assistive devices, marketing and sales assistance, classes or training, and a host of business essentials.

Developing support strategies is the result of a good “discovery” process These strategies should be detailed in both the business plan Operations section and in the PASS. Family support is a typical approach in most American businesses, and rehabilitative supports through an employment specialist or job coach is often available.

One of the most natural means of attaining support in a small business is to make certain that the cost of identified supports are built into the pricing structure and that during feasibility testing it is determined that these costs can be covered once disability system financial support is diminished. In many typical small businesses, the owner does not perform the accounting functions, because most business owners are more interested and skilled in producing their particular product or service. Therefore, the accounting functions are outsourced to a local Certified Public Accountant (CPA), and the cost for those services becomes a consideration in the pricing of the products sold.

Another method of accessing supports is the business-within-a-business. This refers to an arrangement in which a complementary service or product is provided within the context of an existing enterprise. Hence, a person interested in weaving custom throw rugs sets up shop inside a woolens retailer, an espresso maker co-locates inside a bakery, or a reflexologist adds a table next to a masseuse. The host business attracts customers, and the existing staff can naturally assist the new enterprise by teaching the tricks of the trade. The host business also benefits from having a value-added service in-house, as well as from the rent generally paid by the new occupant. In these cases support and assistance may take the form of joint advertising, assistance with customer and production scheduling, training in the use of tools and equipment, help with pricing and bookkeeping, and assistance with inventory, supply ordering, transportation and delivery.

Social Entrepreneurship: Strategies for Organizations

Many organizations, including public agencies have begun to understand their missions as not as relief of the immediate effects of poverty (hunger, shelter, insufficient resources) but as the equipping of people to overcome poverty through the cultivation of the skills and abilities that foster independence.

 Transforming Charity (Streeter 2001)

Over the past decade, the spirit of entrepreneurialism has taken root in communities where new and creative methods of addressing homelessness are being sought. Government and the philanthropic sector are increasingly using the terms of business (for example, “community investment” rather than “charitable giving”) to define the terms of their approach to building communities. They are also realizing that communities themselves must invest skills and assets from a number of sectors. We hear more about governments seeking to develop multi-sector collaborations including those with the faith-based community, the business sector and other agencies with a charitable mission. The President’s “Faith Based Initiative” speaks eloquently about the dynamic hope, passion, and entrepreneurialism of faith-based groups who have been addressing poverty and building healthy communities for hundreds of years (Streeter 2001). 

Many philanthropic organizations and public agencies have realized that they cannot erase homelessness, promote recovery and community inclusion, and build healthy neighborhoods if they fail to provide opportunities for people to gain marketable skills and increase self-sufficiency. These groups understand that “achieving social good in the form of increased self-sufficiency among families in need requires the application of business principles to their organizations and closer relationships with employers” (Streeter 2001). Throughout the country, a number of community-based mental health, housing, and homeless services providers have understood that helping people become more self-sufficient often begins with challenging traditional concepts of work readiness. People they serve tell them they want a range of individualized job opportunities to help them ease back into work as they undertake the task of recovery and stability in their lives. Above all, they want to be treated with respect and receive a living wage.
People who are homeless must be creative, resilient and entrepreneurial to survive on the streets. Although they may not use a formal business planning approach, they must know their customers, competition, and how to market. Some “street-wise” entrepreneurial assistance programs are underway throughout the country that harness the creative business experience and acumen of people who are homeless and channel those skills into legitimate business activity. One successful model of social entrepreneurship is the “Street Wise” newspaper enterprise:

Case Example:

A newspaper enlists people who are homeless as vendors of their newspaper. Many of these vendors connect their personal and professional success (i.e., their survival) with the entrepreneurial structure of StreetWise. Rather than considering vendors “employees” of StreetWise, vendors are treated as "independent entrepreneurs working their way toward success." In fact, StreetWise itself is incorporated as a 501(c)(3) organization whose “practice closely resembles that of a for-profit company, but our bottom line is ‘people first.’” Vendor Bryant Haslerig shared, “I can feel much better about myself with the new vision I have of myself as an entrepreneur.”

Agencies like Streetwise decry the old and ineffective treatment models of sheltered work and instead create social purpose businesses that operate within recognized industry standards. Unlike treatment models, they don’t require people to work in their businesses to “prove themselves” before they get a chance at a competitive sector job.  Employment in an enterprise is just one of the options people can choose from. These social entrepreneurs have met the market with a mission and understand that they have two “bottom lines.” The first is a return on investment in the number of people they serve who have escaped poverty and homelessness and now function in self-satisfying roles in their community despite their disability. Their second bottom line is to operate a financially viable enterprise. Together these objectives meet in helping to create communities “of the whole” where all citizens have the opportunity to be included and contribute.

Case Example:
Neighborhood Properties Services, Inc.

Neighborhood Properties Services, Inc. is operated by a mental health and supportive housing agency, Neighborhood Properties, Inc. (NPI), in Toledo, Ohio. In 2001, Director John Hoover, his Board and staff decided to make employment a priority for the over 500 people they serve annually. Of these, over 90 percent come to NPI from homelessness and the majority have mental illnesses or co-occurring disorders. At the time of its decision to start a social purpose venture, NPI estimated that approximately 80 percent of their tenants were unemployed. NPI recognized that it spent almost $190,000 per year for grounds maintenance for its 88 properties. By developing an industry-standard landscaping, janitorial and construction company of its own, it has been able to provide a wide range of training and job opportunities with greater flexibility around entrance requirements, schedules, and tasks than usually available in the retail employment market. Furthermore, NPI realized that they could not start a business on their own without some staff knowledge of basic lawn care, construction, and building maintenance tasks. They reached out to Aramark/Service Master, Inc., an international industry leader in those trades with a strong social mission (“Tru-Green ChemLawn”, “Merry Maids”, etc) as an initial partner in the project. Service Master helped them develop their business plan and training structures. Now, the business operates on its own.

Since inception, over 60 people entered the business.  Of this number, 10 percent have left for other competitive employment that either paid more or provided increased opportunity for advancement.  Today, NPI continues to employ 25 people at any point in time.  No employee has ever been terminated.  A number of people have discontinued work on their own or taken a sabbatical of their choice.  Some have taken a number of such leaves, but they are typically welcomed back when they are ready and the work is available.

Operating a business with inherent flexibility and need for accommodations does present challenges, and their “no-fail environment” severely limits their ability to be competitive in the private market.  Each manager in landscaping, construction, and janitorial services knows the philosophical values that drive the hiring, training, and advancement of employees.  At times, there is serious conflict, as managers are held accountable for performance and costs, yet are working with employees with individual needs (i.e., flexible scheduling).  These considerations tend to drive up costs that competing firms able to quickly fire and replace workers do not have.

NPI also incorporates prevailing wage levels and opportunities for advancement and growth into its plan. In all three business units, former entry-level employees have risen to full-time, supervisory positions at more than $10 per hour.  In each case, they initially tailored their work and responsibilities to suit their personal abilities and comfort and advanced on their own timetables after getting experience.

NPI’s Director, John Hoover, offers some advice for agencies interested in starting social purpose ventures:

  • Quality leadership is a key factor. Leaders need to understand both the demands of running a competitive business and of working with their particular workforce.

  • Do give people many chances. Know that you’ll get swindled once or twice, but don’t take it personally.

  • Don’t fear collaboration, but understand that social enterprises “push the envelope.” You should not assume that your community collaborating agencies will embrace your efforts, especially if your approach calls into question entrenched values and methods.

  • Make sure your business plan is flexible and stays in step with economic conditions and emerging competition.  That may involve ending a business and replacing it with others if the business climate dictates this strategy and the business plan supports it.

Perhaps most importantly, this “no fail orientation” has led to success stories like the one below that was recently published in the NPI newsletter. 

Case Example:
A Story of Entrepreneurial Success from NPI

This year has been special for Richard Liegl. In July he traveled to Washington, D.C. with other NPI employees to talk about mental health and homelessness at the National Alliance to End Homelessness (NAEH) summer conference. He met U.S. Rep. Marcy Kaptur and U.S. Rep. Paul Gillmor and shared his story with them, asking them to support full funding for supportive housing in the national budget. The formerly homeless man celebrated his first anniversary as a homeowner on Aug. 19 and his 50th birthday on Aug. 23. He was featured in a county-wide publication, Healthy Living News, which highlighted his recovery as a mental health success story.

Mr. Liegl’s difficulties began in his early 20’s when he was living with his family in Cleveland. He couldn’t seem to hold a job. His relationship with his parents was getting worse and worse. “They thought I was uncontrollable,” he said. “I probably was. I don’t remember.” At that time, nobody could see that the real problem was schizophrenia. “They were in denial - they thought I was on drugs,” he said. “I was in denial – I thought everyone was hearing the same voices I was.”

When the family moved to Florida in the late 1970’s, the young man stayed behind. “My pop gave me money for three or four days in a hotel, and then he left,” Mr. Liegl said. “I guess that was tough love.” For the next 25 years, he and his family lost track of each other completely. He did the best he could to survive, moving to Erie, Penn., to attend trade school and earning certificates in machine shops, foundry and janitorial work. However, until he learned to manage his illness, steady employment would be just a dream. “I’d get a job, and they’d get wind that I was on meds or something like that. Then I’d get called into the office and they’d say ‘You did this, and you did that.’ Then it was over.”

Without income or guidance, he drifted. By the late 1980s, he was homeless in Toledo. One of his downtown hang-outs was a sidewalk grate near The Blade that emits heat during winter. Finally, a turning point came in 1993 with a stay in a local jail after he had words with a police officer. He ended up in the mental health ward of a local hospital shortly afterward. “I was wondering what I would do when I was discharged,” he said. “I was very relieved when they said I would go to a group home.” The facility for mentally ill adults gave Mr. Liegl a chance to focus on getting well. He lived there for seven years, with Social Security covering the cost of his care. “That’s what I needed... It gave me a chance to settle in somewhere,” he said.

In 1996 Mark Ashley of Neighborhood Properties, Inc. (NPI) entered the scene. NPI, which provides supportive housing to persons with mental illness, oversees a number of group homes for the Lucas County Mental Health Board. As Social Recreation/Assessment Coordinator, it was Mr. Ashley’s job to motivate group home residents to learn and grow. “I took him out to movies, and we ate at restaurants,” Mr. Ashley said. “I encouraged him to keep moving and not to give up… it gave him more confidence and hope.” Mr. Liegl was receptive. He began to participate at Unison Behavioral Health Group’s Aim High Clubhouse, gaining social and skill-building experiences. From there he was referred to Goodwill Industries because of his good work. By 2000 he was ready to try independent living at an NPI apartment. He received assistance first from the Housing Assistance Program, funded by the Lucas County Mental Health Board. Later his rental subsidy was switched to the permanent Section 8 Program, funded by the Lucas Metropolitan Housing Authority. Mr. Ashley watched his progress and stepped in when a custodian was needed to clean NPI’s main office. He talked to Executive Director John Hoover about giving Mr. Liegl the job. “John gave him an opportunity to work,” Mr. Ashley said. “He’s just been excelling since then… he’s just been doing his own thing, growing and growing and growing.”

After three months as a part-timer, Mr. Liegl switched to full-time work. He is known around NPI for his friendly, hard-working nature. He is also the official grill chef at NPI picnics. “One time I asked Richard how he was doing,” recalls NPI Executive Director John Hoover. “Richard’s answer was, ‘How many times have I called in sick in the past three years?’” The answer – no absences – indicated Mr. Liegl was doing well. Success just kept coming. During December 2001 and January 2002 he traveled to Washington D.C. with other NPI employees to make a presentation on homelessness and mental illness. In addition, he got his driver’s license and found and visited his parents after 25 years. The picture was almost complete.

His most recent accomplishment meant a great deal to him. Thanks to the Home Ownership Program at the Lucas Metropolitan Housing Authority, Mr. Liegl was able to purchase a home in August 2003. He received a mortgage from Huntington Bank and financial assistance from the Ohio Department of Development, the Ohio Department of Mental Health and his family in Florida.

“It was nice to have that family support,” he says with a smile. “That was really good.”

As Richard Liegl’s story shows, customers, suppliers, family, and friends represent a naturally growing support system. In addition, mental health professionals can play a crucial role in facilitating this network’s growth. It is important to realize that the need for formal extended support may be expected to ebb and flow – much like a typical business cycle.

Self employment presents an economic development approach to the problem of unemployment for individuals Social enterprises that operate as true enterprises, not sheltered workshops, exemplify this approach. Matching the person to a product or service, then identifying or developing the market for the service or product, creates opportunity.

Critical elements in lasting success for such enterprises include:

  1. Long-term mental health, housing, medical, and business supports, and

  2. Development of a support network that can point out growth opportunities and identify business and personal difficulties before they reach crisis stage.

Cary Griffin and Dave Hammis
Gary Shaheen,  MPA

About the authors: Cary Griffin is Senior Partner at Griffin-Hammis Associates, a full service consultancy specializing in building communities of economic cooperation, creating high performance organizations, and focusing on disability and employment. Recently, Mr. Griffin has been instrumental in designing self employment protocols and training for individuals, agencies, and states.

Dave Hammis is Senior Partner at Griffin-Hammis Associates. Formerly, he managed the Rural Entrepreneurship and Self Employment Expansion Design Project for the Rural Institute of the University of Montana. He works with organizations nationally and internationally on self-employment and other issues. He is personally responsible for the implementation of thousands of Plans for Achieving Self Support (PASS) leading to employment, self employment, and enhanced personal resources for people with disabilities.

Gary Shaheen provides employment program training and technical assistance to homeless and mental health services providers throughout the country and internationally. Mr. Shaheen is a contributor to and senior editor of the SAMHSA publication “Work as a Priority: A Resource for Employing People Who Have a Serious Mental Illness and Who Are Homeless.” He is a leading authority on social enterprise development and self-employment.


Callahan, M. & Garner, B. (1997). Keys to the Workplace: Skills and Supports for People with Disabilities. Baltimore: Brookes Publishing.

Doyel, A.W. (2000). No More Job Interviews: Self employment Strategies for People with Disabilities. St. Augustine, FL: TRN, Inc.

Emerson, Jed. (1999). “Leadership of the Whole” in 2-volume box set from the Roberts Enterprise Development Fund (REDF): Social Purpose Enterprises and Venture Philanthropy in the New Millennium. San Francisco, CA: REDF. May be ordered or accessed from the Web at this address:

Griffin, C.C. & Hammis, D. (2003). Making Self Employment Work for People with Disabilities. Baltimore: Brookes Publishing.

Hammis, D. & Griffin, C.C. (2002). Social Security Considerations for Entrepreneurs with Significant Disabilities. Florence, MT: Griffin-Hammis Associates, LLC. (available at

Shelley, R., Hammis, D. & Katz, M. (2003). It Doesn’t Take a Rocket Scientist to Understand & Use Social Security Work Incentives. Missoula, MT: Rural Institute/University of Montana. (available at

Streeter, R. (2001). Transforming Charity: Toward a Results-Oriented Social Sector. Indianapolis, IN: Hudson Institute.