THE DRY-CLEANING SHOP IS HOT AND SMELLS of fumes from the rackety 30-year-old cleaning machine.
Dresses, blouses and suits are everywhere. Five workers are non-stop busy, ironing, folding, hanging clothes. The boss is hustling, too, lifting piles of dirty laundry.
”Did you see how thick her forearms are, how strong she is? That`s a lady who works for a living. She doesn`t spend a lot of time at the manicurist, that`s for sure,” Tod Kersten observes.
Wanda Kemilew is the kind of person Kersten likes to see: determined, willing to work. She`s just the kind of people he likes to give money to.
People also like Jeremi Jobda, who makes sweaters in his basement. Or Kazimierz Misiukiewicz, who wants to bring the first telephone pagers ever to Bialystok, Poland.
Kersten is a moneylender, a small-business loan expert. Today he`s here in Poland. Not too long ago, though, he did the same work half a world away, on the South Side of Chicago. That`s why it`s so remarkable that the people he meets here are so much like those he used to deal with in Chicago. ”They`re individualistic, strong-willed and tough,” he says.
Kersten spends his days visiting Poland`s newborn capitalists and deciding who should get loans. He`s a loan officer for the Polish-American Enterprise Fund, one of many agencies helping Eastern Europe leave communism behind.
Kemilew wants $15,000 to buy a new ”ecologically conscious” dry-cleaning machine. Kersten and Slawek Wasowski, one of the Fund`s Polish loan officers, arrive to check him out.
Kemilew shows them around as Wasowski translates for Kersten. Her shop is like many in Poland: kind of drab, gray, running on machines that are almost antiques. She points to her noisy, tired-looking cleaning machine and says:
”It`s 30 years old. It belongs in a museum.”
Kersten laughs. He`s 30, too, he says, but not quite ready to become a museum piece. Kemilew smiles, then explains that she wants an efficient new machine, one that doesn`t pollute. She`s worried about her son and her workers, who breathe the fumes all day.
Kersten needs to know about her business, so he starts to question her.
”How much does it cost to do a shirt like this?”
”This is Warsaw,” Kemilew says. ”It`s not the fancy part of Manhattan. It`s Harlem. I must be cheap.”
His questions keep coming: How much money did she make in 1991? What are her best months? Her worst months? How long does it take to clean the clothes? How many pieces does she clean in a month? How much does it cost her? What are her labor costs? Does she have a lease?
Kemilew answers most of the questions off the top of her head, others after referring to a dogeared notebook with four years of handwritten records. ”How do you keep the competition away?” Kersten asks.
”Price,” Kemilew says.
Some of her competition is a little odd. A doctors` office has opened nearby, and as a sideline, the doctors take in clothes and send them out to be cleaned.
In the U.S., that would be quite odd, to be sure. Here, it`s just another curiosity of a system undergoing transformation. ”She ought to go into the doctoring business,” Kersten jokes.
Kemilew started her cleaning business 25 years ago after her father was imprisoned for political reasons during the communist era. ”After that,” she says, ”I didn`t want to work for a state-owned firm.”
Kersten asks about suppliers, and she says: ”During communist times, I had to buy from thieves. Now there are wholesalers.” But some things are harder now. ”At that time, everything was cheap.”
She works with her son, Jerzy, 27. Her establishment has no name, and she never advertises. She explains: ”Two or three years ago, a man painted a sign on a bench and got paint on his trousers. He brought the trousers in here.”
The pants were cleaned perfectly. ”He wrote a letter to a newspaper, and people read it,” she says. ”It was a disaster. I couldn`t handle all the business I was getting. Now I`m afraid of too many customers.”
Kersten and Wasowski tell her she`ll get a decision within a week. After they leave, they discuss a shortcoming: She has very little collateral.
But they`re clearly impressed. Here`s a hard-working woman who ran a business when few others dared try it. ”She looks honest,” Wasowski observes. ”Not only her face, her personality.”
Kersten spends his time meeting people like Kemilew. ”It`s the best job in the world,” he says. He is, after all, a witness to history. He`s watching a new birth of capitalism. ”I see this city in black and white. It`s almost like watching a film being colorized,” he says. ”I`ve a got 50-yard-line seat to one of the biggest dramas of the century.”
KERSTEN ISN`T YOUR TYPICAL BANKER, AND THE Polish-American Enterprise Fund is no ordinary moneylender. Established in 1990 by the U.S. Congress, the non-profit corporation makes loans that most banks wouldn`t. About a third are for new Polish businesses, some of which are nothing more than an empty office and a new idea.
”Most American bankers would think we`re crazy,” says Richard Turner, chairman of the Fund`s small-business loan program. But that`s what the Fund is all about: helping Poland to replace old, crumbling state-run factories with vibrant private enterprise.
”Poland was a developed country, but (it was) frozen in a time warp,”
says Francis Skrobiszewski, the fund`s New York-based vice president.
Congress allocated $240 million to the Fund, which is similar to but larger than other funds in Hungary, Czechoslovakia and Bulgaria, Skrobiszewski says. The loan program is only part of the Fund`s activities; it also invests directly in local enterprises.
The loan program itself began in January 1991 and now offers loans of up to $75,000. As of July 21 this year, 1,225 loans had been approved, creating an estimated 4,059 jobs.
Those loans averaged $22,200 for a total of $27.2 million. Their 12 percent interest rate is far lower than that of most other loans in Poland, which runs about 50 percent. (Fund loans are made and repaid in American dollars, though, so borrowers risk a setback from possible devaluations of the Polish zloty).
Loan repayments come back to the Fund, helping to make it self-sustaining. So far, things are going well. ”We`ve got a delinquency rate right now of 2 percent,” Turner says. ”Most banks back in the U.S. would love to have a commercial delinquency rate of 2 percent.”
As Poland undergoes a chaotic transformation of its economy, not many Westerners care to risk lending money here. But Kersten and Turner are used to granting loans under similar circumstances. They both came from Chicago`s South Shore Bank, known for giving loans traditional bankers wouldn`t touch.
Chicago`s South Shore is a mostly black area, and ”nobody wanted to lend to a minority market, a neighborhood on the edge of the ghetto and falling in,” Kersten recalls. ”It was a market that banks were no longer interested in.”
Yet South Shore Bank reached out to the community and thrived. For the past several years, its loan ”charge-off” rate (loans that failed) has been only six-tenths of 1 percent, Turner says.
South Shore Bank is so well-known in the banking world that the Enterprise Fund turned to the it when it started the loan program. So it was that Turner, a vice-president of South Shore, traveled to Poland to help set up the program. Today he spends half his time in Chicago and half in Warsaw. Kersten, meanwhile, works in Poland full-time.
But whether in Warsaw or on Chicago`s South Side, both men say that entrepeneurs are all alike.
”The types of personalities I`ve seen for 20 years in Chicago and those we see here now are remarkably similar,” Turner says. ”I`ve come to believe there`s an entrepreneurial personality. Entrepreneurs don`t want to account to anybody, don`t want to respond to what they see as bureaucracy. It`s an egoistic personality that says: `I can do it. I can sell it.` ”
The Warsaw offices of the Enterprise Fund are housed, ironically, in the city`s old Communist Central Committee building. Kersten, though, often works outside the office 10, 12, even 14 hours a day. He crisscrosses Poland, meeting carpenters, lampmakers, printmakers, clothes designers, dentists, auto mechanics. He has been so close to the Ukraine border that road signs were in Russian, he says. ”And I`ve done deals in Bialystok, Poland, which is way up yonder.”
A farm kid, Kersten hails from Hamburg, Ark., a town of about 3,000 near the Louisiana line and the Mississippi River. At one time, he worked at the Southern Development Bank Corp., giving low-interest loans in rural Arkansas. He speaks in a smooth Southern drawl that confounds many Poles, even those who thought they knew English. Once co-workers get used to his curious brand of English, though, Kersten`s easygoing manner and colorful language make them smile.
He lives in a one-bedroom Warsaw apartment and sings with a Polish blues band on weekends. Tall and broad-shouldered, he dons jogging clothes and runs for miles through the streets of Warsaw, an odd sight in a city not quite ready for American-style physical-fitness routines.
His job, unfortunately, does have its downside. ”I had the great honor and misfortune of doing one of the first foreclosures in Poland,” he laments. But in a country where many are still trying to figure out capitalism, his skills are deeply admired.
”Mr. Kersten impresses me with his deep knowledge about business,” says Jeremi Jobda, who runs a fledgling sweater manufacturing firm.
Kersten and Wasowski`s meeting with Jobda is on same day as with Kemilew. Jobda`s business is like many of the others; it`s run out of the family home- the basement, to be exact.
The two men drive the Fund`s Hyundai for about an hour out of Warsaw to reach Jobda`s village, Karczew, and get lost on the way. ”A lot of the streets had the names of communitst heroes,” Wasowski says, ”and now they`ve changed.”
”Which makes it really interesting moving around a small town with an old map,” Kersten adds, somewhat disgruntled.
But they finally arrive at their destination, and Jobda, who`d been anxiously waiting for them, starts down the steps of his two-story home as soon as they pull up.
He takes them to the basement, where balls of yarn are in piles and finished sweaters are hanging up, ready to go. A woman works on a loom; a second machine runs itself. Jobda had contacted the Fund because he wanted four more looms, sophisticated ones that can use four or five different-colored yarns at once.
He shows them the computer in the bedroom where he designs the sweaters`
patterns. If they get the loan, the new looms will go in the garage.
Maria, Jobda`s wife, works with him now, having given up her job as a teacher, which paid her only $100 a month. During these strange times, there`s not much money for education in Poland. ”I`m pretty big on the family being the essential unit for small businesses,” Kersten says. ”They don`t call them `mom-and-pop` businesses for nothing.”
Kersten questions the Jobdas just as he has questioned Kemilew: How much do the sweaters cost to make? How much do they sell for? How many customers do they have? What are their profits, taxes, net sales?
The couple answer quickly and easily, and Wasowski and Kersten are again pleased. ”That was textbook small business,” Kersten says after they leave. ”You got to like them.”
It has been a straightforward, uncomplicated day. Not all days are like that.
On another day, Kersten arrives in the office at 8:30 a.m. Wasowski isn`t with him this time, so he needs his assistant/interperter, Kasia Szczepanska. She isn`t there yet, so he waits.
She arrives, then disappears again. He finds out she has gone to breakfast, so he waits some more. Here in Poland, the rules are a little different. After all, the strict timetables of Western capitalism didn`t apply here for decades.
Szczepanska finally returns from breakfast, and they`re ready to leave. It`s 10 a.m. They first head to a bank that the Enterprise Fund works with, the Powszechny Bank Kredytowy (Popular Credit Bank) in downtown Warsaw. They squeeze into one of Poland`s typically tiny, dark elevators and go up to the office of Maria Wicik, a credit officer.
Bank officials first evaluate loan applications that come to the Fund. When they recommend approval for a loan, a Fund officer like Kersten makes a personal visit to the client. He can personally approve loans of up to $20,000. Bigger loans go to a credit committee for final approval.
This morning Kersten and Szczepanska are to go to Bialystok, a city about two hours by car northeast of Warsaw. But Wicik is disappointed, wanting them first to see a man in another city, Siemiatycze. Kasia translates Wicik`s Polish: ”There`s no way to tell him you`re not coming, because there`s no phone.”
That`s how it is in Poland-no phones, especially in the smaller cities and towns. But it`s already 10:15; they`ll have to make that visit another day.
Jerzy Gliniecki, another local credit officer, hands Kersten files on businesses he`ll see in Bialystok. Kersten wants some feedback on them, but Gliniecki didn`t handle them and can`t say anything about them. Kersten also needs a good road map; the one in the Fund`s car has mysteriously disappeared. ”Do you have a map?” Kersten asks.
No, they don`t.
Does anyone know the address of an office they have to visit in Bialystok?
No.
Sometimes Poland`s new world of business doesn`t run too smoothly. ”The whole organization thing just isn`t happening for me,” Kersten grumbles.
”You`ve got a choice when you come to Poland-either die in a fit of apoplexy or deal with what you`ve got. You`ve got to remember that in this job, it doesn`t pay to get upset.”
They get on the road. It`s 10:40 a.m. They still don`t have a map.
”Do you know the way to Bialystok?” Szczepanska asks, uncertainty in her voice.
”Thankfully, I do,” Kersten says.
THE DRIVE, ACTUALLY, IS PLEASANT. ALONG THE way are farmland, woods, fields of flowers. A horse-drawn wagon plods along. A farmer walks behind his horse with a plow. The sun shines.
”Kasia,” Kersten asks, ”would you reach back there and get those files for me? Why don`t you tell me a little bit about them.”
Kasia reaches for the files on the back seat and reads through the first. ”They want to buy a system for paging. It costs $30,000.” She is puzzled.
”Do you know what paging is? Do you have it in the States?”
Kersten nods.
”I have no idea what this is. I never heard of it.”
He starts to explain, and she says, ”Is it that you have this small beeper, and it tells you where you have to call?”
”Yes.”
”Oh, I know this. I know this.”
She reads on, trying her best, though her English isn`t perfect. Then she goes to the next file.
”They want a loan from us for $70,000. They want to produce windows.”
Suddenly, the road ends at a construction site. There`s no detour sign, so they head off into a side road. That road takes them to a river. A cow is grazing nearby. They turn around and head back, along with other drivers who also didn`t know where to go. They turn down another road where, about half a mile later, a detour sign finally appears.
