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How Indian Americans Came to Run Half of All U.S. Motels

nationalgeographic.com

61–70 of 256 posts

Re: How Indian Americans Came to Run Half of All U.S. Motels

#61

Can someone tell me why the surname of Patel is so predominant in the hotel owners? The article doesn't really explain why.

This community uses traditional/informal financing methods with members of their community with primarily "social reputation" at stake. This kind of financing not available to outsiders, and that kind of community effects are every where to be seen in many industries.

For example, there was an article about how Portuguese immigrants have sort of dominated Dunkin franchises.

Re: How Indian Americans Came to Run Half of All U.S. Motels

#62

Earlier quoted context omitted.

No one who travels and stays in small-to-medium-sized hotels is shocked by this. I have a complaint, however. We have so many Indian-Americans distributed all over the nation, and it is still fairly difficult to find good Indian food outside big cities.

I've wondered about this, but what I've heard is that few Indian families eat out very often.

For the time I spent in India, most of them eat their meals at street stalls throughout the day. Those that do have home cooked meals, often have housemaids that do all of that super labor intensive cooking. Even the relatively poor, have even poorer people working below them at home!

Re: How Indian Americans Came to Run Half of All U.S. Motels

#63
post #45

Earlier quoted context omitted.

> There is a very strong individualist streak in American culture and a very strong taboo against lending friends or family members money I think the individualist streak in American culture is better shown by people being unwilling to seek help from friends/family. I might call an unwillingness to help others (assuming one can afford to do so) selfishness -- not individualism. But what I have seen in American is, as…

I think it's much deeper than "individualist streak in American culture". Western Europe in the last 1000 years or so has been a very unusual place... one aspect of which is having nuclear families not extended ones. Because (crudely speaking) the catholic church wished to diminish alternative power structures, such as clans. This led to an unusually open society, which had many benefits... with generally higher leve…

I never connected the decline of extended families to the church, but that sounds fascinating. Any recommended reading?

Re: How Indian Americans Came to Run Half of All U.S. Motels

#64

This model has led to success for other immigrant groups in other industries. > Many followed his advice. “They would give each other handshake loans—no collateral, no payment schedule, just pay when you can,” Doshi explains. Once a family purchased a motel, they would live there, and the family members would do all the tasks needed to run it, from cleaning rooms to checking in guests. That helped keep costs down, an…

> The "killer app" here appears to be a lack of resources beyond established relationships. Because of this, whole families were willing to spend their time doing work that most Americans feel is not worth their time.

I really dislike this argument. It makes middle-class Americans sound like a bunch of ungrateful churls, because they think that is beneath them (at the price the employer is willing to pay, but that part is always left unsaid).

I don't call my landlord an ungrateful churl, because he thinks that my for his apartment is beneath him. Yet, this is a consistent argument whenever an employer-employee relationship comes up. No shit, I don't want to pick strawberries for $5/hour, when my rent is $2250/month. That's not because manual labour is beneath me.

The thing is - at a low enough price point, no work is worth anyone's time.

Those family members were probably working for below minimum wage. Surprise - their business was successful, compared to one where you have to hire employees, and pay them a minimum/living wage, and have an inflexible schedule of interest payments to whomever fronted the money for you to start the business, etc, etc.

It's not culture. It's economics.

Re: How Indian Americans Came to Run Half of All U.S. Motels

#65
post #35

Earlier quoted context omitted.

Also access to cheap/free labor, also perhaps underaged labor?

You could make the argument that startup founders who aren't taking a salary from their early stage startup are also performing "free, illegally so" labor.

I think in that case, you can't work for yourself illegally.

Re: How Indian Americans Came to Run Half of All U.S. Motels

#66
The story totally checks out. I moved from Boston to San Francisco in 2006, did a cross country drive. Back then we only had flip phone, so I would use my laptop and The Microsoft Streets software with a GPS. Every day, around 3 PM, I would pull in into the parking lot and locate a Motel 30 or 40 miles ahead using the GPS and Streets software, and call and book a room.

8 out of 11 motels I stayed in were owned and run by Gujjus (Gujaratis, originally from the state of Gujarat in India). I was really surprised by this, because until then, I was only used to seeing East Indians working either in Tech or in Gas Stations, 7/11s.

Being a 1st generation Indian immigrant myself, almost always the owners would relate to me and tell me their immigrant story. And yes, almost all of them said the same thing the story mentions, i.e. borrowing money from family to buy a run-down / cheap motel business, live in it and work on it. One of them even shared their Gujju dinner with me as I'd arrive late and all the restaurants were closed in the Area ( Eureka, CA)...

Not all of them carried the business forward though. 1 guys son was working to be an Airforce Pilot and another's daughter was going to Law School. As told by their fathers neither one wanted anything to do with the Motel business, but they put in their work as kids, working at the motel while off school and such.

After moving to San Francisco, I met another Indian-American "Patel" , born to Indian immigrant parents. He too had a family run motel in Portland and would tell me stories of how everyone in the family had to pitch in to make it work. Gujjus are hard working people and I really admire their work ethics and grit.

Re: How Indian Americans Came to Run Half of All U.S. Motels

#67

Earlier quoted context omitted.

I've wondered about this, but what I've heard is that few Indian families eat out very often.

Indian food is labor intensive and uses expensive ingredients. Restaurants are also low margin businesses that don't scale well and are super risky, not something I'd advise someone to do unless they have a passion for it and ability to fail and carry on with life. I have not been to a single Indian restaurant that can compare to a home cooked Gujarati meal, especially made by someone who grew up there.

> Indian food is labor intensive and uses expensive ingredients

Labor intensive yes, but expensive ingredients? Maybe saffron, but it's used very sparingly in only a few dishes, and a little goes a long way.

Re: How Indian Americans Came to Run Half of All U.S. Motels

#68

Earlier quoted context omitted.

There are good reasons that many people avoid lending money to (or even doing business with) close friends and relatives. If the venture doesn't succeed, and the friend is unable to repay the loan, it can create animosity and bitterness that wreck the relationship. Even if things go well, it can create an uncomfortable power dynamic that makes the relationship less pleasant and friendly.

I also think a middle-class family is in the "sweet spot" where they have a lot to lose from offering a loan as opposed to either not having a lot to lose in the first place or being so well-off that they can easily just write off a bad investment.

I think both of your are correct, but to add another problem, its that there is sort of the understanding that a family member isn't going to try and get your house/car/whatever taken away to pay off the debt. So, family loans are often viewed more as gifts. I'm not going to give a family member 1/2 my life savings as a gift until it becomes an inheritance, unless I really believe in the business and am getting some kind of equity stake/collateral in return i'm not going to be making a "loan".

Plus, its one thing to "invest" in someone buying an asset, like a house/motel/gas station/CNC mill/whatever, vs loaning someone money to start a graphics art business where the money is going to basically pay "salary" and once its spent there isn't anything left to sell when the business fails.

Although, the one common thing I've seen a couple times, is an uncle/whatever paying for a college or a trade (like nursing) school under the "teach a man to fish" theory.

Re: How Indian Americans Came to Run Half of All U.S. Motels

#69
post #45

Earlier quoted context omitted.

I think it's much deeper than "individualist streak in American culture". Western Europe in the last 1000 years or so has been a very unusual place... one aspect of which is having nuclear families not extended ones. Because (crudely speaking) the catholic church wished to diminish alternative power structures, such as clans. This led to an unusually open society, which had many benefits... with generally higher leve…

I never connected the decline of extended families to the church, but that sounds fascinating. Any recommended reading?

I'm struggling to think of a good source right now, sorry. But a link I've posted before looking the other way, at how the other half of the Roman empire turned out: https://www.theamericanconservative.com/articles/cousin-marr... also more recent discussion https://marginalrevolution.com/marginalrevolution/2018/01/ma...

Re: How Indian Americans Came to Run Half of All U.S. Motels

#70
post #58

This model has led to success for other immigrant groups in other industries. > Many followed his advice. “They would give each other handshake loans—no collateral, no payment schedule, just pay when you can,” Doshi explains. Once a family purchased a motel, they would live there, and the family members would do all the tasks needed to run it, from cleaning rooms to checking in guests. That helped keep costs down, an…

There's an interesting ancient pattern of small minority groups dominating certain businesses, often ones which need trust -- here "handshake loans", but traditionally also simply payment for goods shipped long-distances. e.g. The Greek trader in one little Egyptian town could be more confident in dealing with another Greek trader somewhere in Italy, a week's sail away, because while he might be tempted to run off wi…

It's sort of common knowledge in India that Gujaratis, Sindhis, Punjabis and Malayalis (Keralites) are generally pretty enterprising and are often businessmen, both within India and abroad. There can be other such Indian communities too, of course. These are just the ones I have heard of (from childhood) as tending to be more so.

For example, the Patels in the US are the topic of this thread; then there are lots of Punjabis (which includes Sikhs) in Canada; Sindhis, I've heard, are many in Hong Kong; and many Keralites in the Gulf. Again, I don't mean to rule out other places where these or other Indians could have gone, these are just the ones I am more familiar with, and may have relatively high concentrations. Be interesting to know if there are other places where particular groups have gone and done well.

Of course, lots of Indians went to Fiji and Malaysia too, I've read, although those may have mostly gone as plantation labor initially (and some to Trinidad and Tobago, Guyana, etc.), during British colonial times. Don't know how those are doing now.

On a side note, when I visited Kuala Lumpur once, I tried out some Malaysian (South) Indian food; it was both similar and in some ways different to South Indian food in India. I guess it is both because they use some different local Malaysian ingredients, and because of the long time of separation from India must have made their cuisine evolved to be somewhat different. It was interesting stuff, though.

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