What makes Amish Businesses so successful? Why have Amish communities left farming for other businesses? And how did Amish entrepreneurs get started in woodworking? For help answering these questions, we turned to Dr. Steven Nolt of the Young Center for Anabaptist and Pietist Studies at Elizabethtown College in Pennsylvania.
The Amish have a long history of entrepreneurial pursuits. But it wasn’t until the 1980s that they started to leave farming behind and focus on alternative businesses. Today, the failure rate of Amish businesses in their first 5 years is just 10% compared to 50% among small business startups nationally! Listen to the full episode to understand what makes Amish businesses so successful.
About Dr. Steven Nolt
Dr. Nolt is a native of Pennsylvania who holds degrees from Goshen College, Associated Mennonite Biblical Seminary, and the University of Notre Dame. He currently serves as Senior Scholar and Professor of History and Anabaptist Studies at the Young Center for Anabaptist and Pietist Studies at Elizabethtown College. He is the author or coauthor of 15 books that primarily focus on Amish and Mennonite history and culture. This makes him a frequent source for journalists and researchers seeking information on Anabaptist groups.
Some of the books Nolt has written include “A History of the Amish,” which is in its third edition, and “The Amish: A Concise Introduction.” He notably co-authored “Amish Grace: How Forgiveness Transcended Tragedy” about the Amish schoolhouse shooting in the village of Nickel Mines in Lancaster County. A few other co-authorships include the book “Amish Enterprise: From Plows to Profits” and a paper titled “Amish Enterprise: The Collective Power of Ethnic Entrepreneurship” that appeared in the Global Business and Economics Review.
History of Amish Businesses & Entrepreneurship
The Amish people have lived a historically agrarian lifestyle. This dates back to their time in Europe before migrating to America. That lifestyle persisted as they spread across the midwestern United States to find land upon which to farm.
But in the 1980s that started to change. Simply put, they began to run out of land. So around this time, when Amish young adults in Lancaster County, PA, got married, rather than starting to farm, they started new businesses! Small family farms are entrepreneurial in nature, but these businesses were a marked change in this community.
Instead of farming, these young Amish families started to create machine shops for farm machinery. Then, woodworking shops to build cabinets or furniture. Soon Amish businesses included fabric and upholstery shops and services, small country stores, and more! By the 1990s, about 20% of Amish businesses were run by Amish women.
Amish Furniture Businesses
Woodworking was one of the first types of businesses they started, inspired by a history of winter-time work (when they couldn’t farm) such as construction. Some created sawmills and lumber processing shops. Others, cabinet building shops. And yet others, Amish furniture woodworking shops.
This trade has simply taken off. Woodworking now makes up about 10% of the Amish businesses in Pennsylvania and a similar amount in northern Indiana. This is due in part to their ethnic values of hard work and attention to detail. That, combined with the technological limitations in their workplaces, Amish craftspeople consistently produce high-quality furniture.
Amish Business Success Rate
Nolt and his co-authors noted in the 2010 paper “Amish Enterprise,” that the failure rate of Amish businesses in the first 5 years is just 10% compared to 50% among small business startups nationally. Nolt credits that success rate in part to the fact that, with smaller operations and less expensive technology, there’s less debt in most Amish business startups. However, it goes beyond that.
What Makes Amish Businesses So Successful?
Nolt explains that there are both Ethnic Resources and Ethnic Restraints that contribute to Amish businesses’ success. Resources include a cost-effective mutual aid system to provide health coverage and other support across the community. Additionally, there are community resources for struggling businesses to get help from elders and experienced business people.
Even their restraints, such as less formal education and, most notably, limited technology use, become benefits to the Amish people. Because of their businesses that stay small and their limited-machinery workplaces, the Amish have naturally cultivated a ‘brand.’ This informal, accidental ‘Amish brand’ is renowned far and wide for quality products and ethical business practices. So their church & community restraints have become beneficial to their business, to their communities, and to everyone across the nation who can enjoy their fantastic products and feel good about support Amish small businesses.
Learn more about the American Amish population at http://groups.etown.edu/amishstudies/
Dr. Nolt also recommends the publication Plain Communities Business Exchange for a glimpse at the Amish business world. Subscribe or learn more at https://www.plaincommunities.com/
For more reading on the topic, check out Erik Wesner’s book “Success Made Simple: An Inside Look at Why Amish Businesses Thrive:” https://www.barnesandnoble.com/w/success-made-simple-erik-wesner/1100298464 or the paper “Amish enterprise: the collective power of ethnic entrepreneurship,” by Donald Kraybill, Steven Nolt, and Erik Wesner in 2010: https://pdfs.semanticscholar.org/5f83/f08e613d01d64378e142537a58e77e0e8f41.pdf
This podcast is brought to you by DutchCrafters: https://www.dutchcrafters.com/