August is observed as Black Business Month in the US, which is a great opportunity to celebrate Black businesses locally and nationwide. The idea was first created in 2004 by engineer Frederick E Jordan (Senior) and historian Jordan William Templeton who realized that finance options for Black entrepreneurs were limited. Templeton was the editor of one of the oldest Black-owned newspapers in the US while Jordan faced hurdles to secure finance for his construction and engineering company in 1969. Their goal was to drive policy affecting more than 2.6 million Afro-American businesses, generate awareness, and eradicate systemic inequities that an overwhelming majority of Black-owned organizations have always faced and continue to face. Black Business Month is a call to empower Black entrepreneurs and forge economic inclusivity for all.
According to US Census Bureau data, Black-owned businesses generated$150 billionin revenue which accounts for only 10% of all businesses. The percentage of products from Black-owned brands on store shelves is much less. However, the number of black-owned business grew between 2017 and 2019 across all sectors, reports the Census Bureau’sAnnual Business Survey(ABS). In 2019, there were 134,567 Black-owned businesses in the US, an 8% increase from 124,551 businesses in 2018.
Black-owned businesses opened in record numbers during the Covid-19 pandemic. According to numbers disclosed byMerchantMaverick, Black-owned businesses increased by nearly 40% between February 2020 and August 2021. Virginia, Maryland, Texas, Nevada, and Delaware were the top five states that recorded the maximum growth.
Extending support to Black-owned businesses
This data indicates the potential that Black-owned businesses have and the contribution they can make to both the economy and society. An increase in the number of black-owned businesses will bridge the wealth gap between Black communities and the rest of the population. The median wealth for white families is 12 times more than Black families, averaging around $140,000. For some time, small businesses and entrepreneurs have been wealth creators in US society. Supporting more Black-owned businesses will create more opportunities for employment, savings, credit building, property ownership, and wealth generation.
Most Afro-American entrepreneurs and business owners fund their own ventures due to lack of capital from financial institutions. A 2017studyby the National Community Reinvestment Coalition (NCRC) revealed that banks were twice as likely to offer business loans to white entrepreneurs than Black entrepreneurs and were three times as likely to have follow-up meetings with white business owners than more qualified Black business owners. Encouragingly, according to a Bloombergreport, the unemployment rate for Afro-Americans fell to 6.6% which was then at an all-time low. Black-owned businesses typically hire from within their local community which helps them achieve financial stability.
Recognizing the rich Black culture
A major aim of Black Business Month is to make people aware of the rich Afro-American culture. Most Black entrepreneurs draw inspiration from their culture to start successful businesses. They own companies that manufacture garments, makeup, beauty products, and children’s toys, to name a few. A few well-established Black-owned brands includeEcoFeed Enterprises,Amsale,Hustle Clean,The Honey Pot Company, andCompac Industries. Many Black-owned businesses are founded to extend accessibility to services that are specific to the community’s needs. These businesses uplift communities and foster a sense of pride among communities. They bring a unique perspective to the products and services they offer.
Black Business Month is a call to act. Championing black-owned business isn’t only about the bottom line. It involves advocating for social justice and racial equality. Advocacy helps individuals gain access to training, educational tools, and networks of support, as well as, offering funding so that Black entrepreneurs and business owners who have struggled for decades to overcome hurdles can finally achieve the holistic success they deserve.