By: Jennifer Magdalene
Small businesses and entrepreneurs have always been an essential part of creating wealth for communities. And when it comes to supporting Black-owned businesses, it’s time we all step up and play our part in helping to build a better future. But why is it so important to support Black-owned businesses? Let’s break it down!
Closing the Racial Wealth Gap
The racial wealth gap in the United States is a persistent problem, with Black Americans facing significant challenges when it comes to accessing higher-paying jobs and homeownership opportunities. According to the Federal Reserve Bank of Cleveland, “In 2016, the average wealth of households with a head identifying as Black was $140,000, while for white-headed households was $901,000, nearly 6.5 times greater”. By supporting Black-owned businesses, we can help increase the flow of wealth to Black families and communities, ultimately working towards closing the racial wealth gap.
Building Stronger Communities
According to The State of Working America, “Black people spend four percent more money annually than any other race, although they are the least represented race and the race that lives in poverty at the highest rate”. With over 2.6 million Black-owned businesses in America, supporting these companies can help to create more opportunities for building wealth, improving credit, and increasing property ownership within Black communities. Unfortunately, eight out of ten Black-owned businesses fail within the first 18 months due to a lack of resources and funds, but by supporting these businesses, we can help keep more money within the community, building stronger relationships and boosting community morale.
A Unique Boom in the Accessory Industry
One industry that’s experiencing an exceptional boom is the design and accessory industry. With the increasing support for Black-owned businesses, more and more customers are recognizing the value and talent of Black designers. One way they have achieved this growth was through expansion into new product lines and personalisation – such as creating custom pendants and miscellaneous items based on the customer’s individual preferences. This has created a surge in demand for their products and has helped them to establish a strong presence in the market. However, starting and growing a business is never easy, and Black designers face many challenges that can make it even harder. Some common challenges include limited access to funding and resources, difficulty in reaching and connecting with customers, and competition from established brands.
Despite these challenges, there are many resources available to help Black designers overcome these obstacles and succeed in their businesses. For example, organizations like the National Black Chamber of Commerce and the National Minority Supplier Development Council offer business development support, including mentorship, training, and networking opportunities. Additionally, there are a number of grants and funding programs specifically designed to support Black-owned businesses, such as the National Black Business Association’s (NBBA) Small Business Grant Program and the Black Founders Fellowship.
Additional Resources for Black-Owned Businesses
Starting a business can be challenging, but for Black business owners, the barriers can be even greater. A recent study by Guidant Financial found that 80% of Black business owners say their number one challenge is access to capital. Black business owners are often unaware of the resources available to them, which can cause added stress, a lack of clarity, and more obstacles to overcome. That’s why it’s essential to raise awareness and support initiatives that help Black-owned businesses access the resources they need to succeed. Minority Business Development Agency (MBDA) for instance is one of the most helpful resources – it is a federal agency that provides resources and support to minority-owned businesses, including black-owned businesses. The agency offers business counseling, access to capital, and access to contracts.
Supporting Black-owned businesses is crucial for building stronger communities, closing the racial wealth gap, empowering local communities, and providing access to essential resources. So next time you need to make a purchase, think about where you can shop black!
