Gay Businesses Find Big Profits in Gay Clientele : Orange County Group Publishes Buyer’s Guide

Times Staff Writer

John Olson says sometimes it pays to be gay.

Six months ago, the 26-year-old homosexual bought three luxury sedans and opened a Huntington Beach limousine service catering exclusively to gays and lesbians.

Ordinarily, a newcomer like Olson would have had a hard time competing with the pack of limousine companies already cruising Orange County. But Coastal Transport was practically an overnight success, and Olson is about to double the size of his fleet to six limos.

The company specializes in a market that nearly every other limo company in Southern California has either overlooked or avoided: gays and lesbians.

Olson decided to start the service after patronizing other limo services with his male lover and being ridiculed by straight chauffeurs. He figured that plenty of Orange County homosexuals had gone through similar experiences and would rather have a gay driver.

“Being gay has been a real advantage for us because there were a lot of limousine services already out there when we started ours,” Olson said. “But very few of them are geared towards gay clientele.”


Olson’s firm is one of more than a hundred businesses in Orange County and several thousand nationwide catering almost exclusively to gays. In fact, there are so many openly gay business owners today that some gay activists speak of two economies--gay and straight.

Thirty gay chambers of commerce across the country--including the Orange County Business and Professional Alliance--distribute directories encouraging homosexuals to “buy gay.” The Orange County group publishes a buyer’s guide of its 130 members, including a veterinarian, VCR repairman, pharmacist, car salesman, architect and even a hypnotist.

“As more and more people come out of the closet, their businesses are coming out with them,” said Arthur Lazere, author of On The Job, a column syndicated in gay newspapers that addresses homosexual issues in the workplace. “Coming out to the gay community can be a sound business decision because many gays and lesbians are more affluent and more loyal than the average buyer.”

To a greater extent than straight businesses, the gay economy is primarily service-oriented. Openly gay and lesbian electricians, lawyers, contractors, psychologists and doctors are not uncommon, even in areas smaller than Orange County.

The proliferation of gay and lesbian companies catering to the gay community is understandable because many perform work that gives them glimpses of clients’ homes, medical histories or love lives.

“I am much more comfortable with a gay plumber than I am with a straight one,” said Jeanne Cordova, publisher of The Community Yellow Pages, a gay and lesbian phone book that has listings from San Diego and Orange County to Palm Springs. “I don’t have to run around the house and hide any telltale signs that I’m a lesbian.”

Openly gay and lesbian retailers are relatively rare, except in urban areas with large and concentrated gay populations. San Francisco and West Hollywood both contain largely gay-owned business districts. Orange County does not, and most of the companies listed in the gay buyer’s guide sell services instead of products.

“Most gay people just want the best deal at the closest place they can find, like everybody else,” Cordova said. “Very few people are going to drive 20 miles out of their way to go to a gay-owned shoe store.”

Framers’ Workshop in El Toro, for example, advertises in homosexual publications and is owned by a gay man, Joe Hodulik. Gays and lesbians, however, account for only 5% to 10% of his business. “But the gays that come into my shop are very loyal,” Hodulik said. “I have customers that come down here from Palm Springs just because this is a gay-run company.”

Retailers selling gay-oriented products are likely to attract a much larger homosexual clientele. Carroll Leslie and Barbara Strauss own A Different Drummer, a Laguna Beach bookstore that sells gay and lesbian novels, among other things. “About 65% of our sales are to gays and lesbians,” Leslie said. “There is no other alternative bookstore in this area, so we fill a void.”

Some gay-owned companies that do a significant amount of business with heterosexual clients are deciding they aren’t willing to hide anymore. “If I have done loads and loads of business with someone and then they drop our firm because I’m gay, it’s their loss,” said Paul Lenaberg, owner of Sharp Personnel & Search in Santa Ana. “There are still lots of other people out there who will deal with me.”

Simmons Market Research Bureau found in a 1986 survey that gays are an appealing consumer group. The national poll showed that the average gay household income was $47,800 a year, and 25% of the gay homes reported salaries higher than $60,000. By comparison, the Census Bureau reported the same year that the average household income in the United States was $29,066.

So far, there is no precise estimate of the annual revenue of gay businesses in Orange County. Nationally, gay firms are believed to bring in at least several billion dollars a year. One gay industry group, the International Gay Travel Assn., said its members last year booked more than $250 million in hotel and airline reservations.

The potential profit from doing business with gays and lesbians is significant, judging by the estimated size of the homosexual population. Studies by the Kinsey Institute and others indicate that 6% to 10% of the general population is gay or lesbian.

Some of America’s largest corporations, including MCA Records and the Adolph Coors Co., have begun advertising in the gay press. San Francisco’s Golden Gate Business Assn., the nation’s first gay chamber of commerce, has grown over 15 years to about 350 members including corporations such as Pacific Bell and Merrill Lynch.

“Straight businesses have begun to join because they saw bottom-line benefits to supporting the gay and lesbian community,” said Dave Wharton, Golden Gate’s president.

So far, no Orange County corporations have approached the Business and Professional Alliance, which was founded 3 years ago.

Homosexual business leaders say that Orange County is more conservative and, in some cases, more hostile than other urban areas where gay-owned businesses congregate. All but one of the officers of the Orange County Business and Professional Alliance requested anonymity, fearing potential harassment in the workplace if their names were made public.

“It is understandable that gay business people here are reluctant to be public about their life styles,” said Werner Kuhn, director of the Gay and Lesbian Community Services Center of Orange County. “We have people like Congressman (William E.) Dannemeyer and Congressman (Robert K.) Dornan screaming at us. These leading homophobes scare people.”

And despite the apparent strength of the gay dollar, few homosexual business organizations have made inroads into straight business groups. Several Orange County business leaders contacted by The Times said they were not familiar with the Business and Professional Alliance.

“Oh my goodness, I haven’t heard of it,” said Lucien D. Truhill, president and chief executive of the Orange County Chamber of Commerce. “It’s a little unusual to have a life style as a chamber. I’m not being critical of it though. I guess it would be like everybody interested in Civil War history getting together. It’s a bit unusual.”

Gay and lesbian business organizations offer their members discounts at gay and lesbian-owned firms and routinely run employment notices in their newsletters. “We try to keep our money and our members within the gay community,” said Dennis Jones, the alliance’s secretary.

Gay businessmen and women say that groups such as the Business and Professional Alliance are growing in popularity because many gays and lesbians say they don’t feel welcome in mainstream business organizations. Many Orange County homosexuals, for instance, took issue with the Chamber of Commerce’s endorsement last fall of Proposition 102, which would have eliminated anonymous AIDS testing and required doctors to report the names of patients carrying AIDS virus antibodies in their blood.

Homosexual business leaders say the gay economy is thriving and will continue to gain strength as more gays and lesbians reveal their sexual preference. The Community Yellow Pages started in 1982 with only 300 ads and 500 listings. Today, it has 1,000 ads and 2,000 listings. “The more people become aware of their identity, the more pride they have and the more they want to patronize their own,” said Cordova, the publisher.

At least for now, some gays and lesbians say they do not feel comfortable doing otherwise, particularly when it comes to things like buying a home.

“They generally feel more comfortable with a gay agent who is looking at things the same way they are,” said Rob Lammers, a gay Orange County Realtor. “There are no questions asked, no raised eyebrows. I’m not going to wonder, ‘Why are they both looking at the master bedroom closet to see if it’s big enough?’ ”