Learn How You Can Support Black-Owned Businesses
In today's business landscape, Black entrepreneurs face a range of challenges that can impact their success and growth. While systemic barriers and economic disparities are well-documented, consumers have the power to make a significant difference. Here’s a look at some of the challenges Black business owners face, accompanied by actionable solutions for how you can help support these businesses.
National Black Business Month
August was established as National Black Business Month in 2004 by historian John William Templeton and engineer Frederick E. Jordan. The goal of Black Business Month is to advance policies that impact Black communities and businesses, and to help develop greater economic freedom. YOU can use your purchasing power to buy from Black-owned businesses year-round, not just in August. Regularly shopping at Black businesses can contribute to their stability and long-term success.
8 Challenges Black Business Owners Face
1. Access to Capital
Black entrepreneurs often struggle to secure funding. In 2022, Black-owned startups received just 1.2% of total venture capital funding. This stark disparity highlights a significant hurdle for Black business owners trying to scale their ventures.
How You Can Help: Advocate for and support initiatives that promote diversity in venture capital. Consider investing in Black-owned startups through crowdfunding platforms and be an informed consumer who prioritizes spending with Black-owned businesses.
2. Credit Accessibility
A 2023 Federal Reserve report reveals that about 40% of Black business owners face difficulties in obtaining loans compared to 25% of White business owners. This credit gap limits their ability to invest in and grow their businesses.
How You Can Help: Support policy changes that address lending inequities and explore alternative financing options such as community lending circles or microloans that specifically support Black entrepreneurs.
3. Economic Disparities
Black-owned businesses are nearly twice as likely to close within the first year compared to their White counterparts. Economic disparities play a significant role in these higher failure rates.
How You Can Help: Use your purchasing power to buy from Black-owned businesses. Regularly shopping at these businesses can contribute to their stability and long-term success.
4. Revenue Gaps
Black-owned businesses generate an average of $58,000 in annual revenue, while White-owned businesses generate around $106,000. This revenue gap reflects deeper systemic issues affecting market access and growth.
How You Can Help: Encourage others to support Black-owned businesses and amplify their visibility on social media. Your endorsements can help drive traffic and boost sales.
5. Market Access
A 2023 survey found that only 20% of Black business owners report having strong networks and market access compared to 45% of White business owners. Limited access to networks can hinder business growth and opportunities.
How You Can Help: Network on behalf of Black entrepreneurs by making introductions to potential clients, partners, or investors. Your connections can help expand their reach and opportunities.
6. Digital Divide
Many Black-owned businesses face challenges in establishing an online presence due to a lack of resources. As of 2024, about 30% of Black-owned businesses report difficulties in leveraging digital tools and e-commerce platforms.
How You Can Help: Support Black-owned businesses by shopping online from their websites and sharing their digital content. Additionally, offer assistance or connections to digital marketing professionals who can help improve their online visibility.
7. Customer Base Limitations
Black-owned businesses often operate within smaller customer bases, limiting their growth potential. A 2023 study indicated that around 35% of Black-owned businesses face challenges in expanding their customer base beyond local markets.
How You Can Help: Help Black-owned businesses reach new markets by sharing their products and services with your network. Positive reviews and word-of-mouth referrals can also broaden their customer base.
8. Systemic Racism
Systemic racism can create barriers that impact the success of Black-owned businesses. This includes discriminatory practices in various aspects of business operations and economic opportunities.
How You Can Help: Advocate for policies and practices that promote racial equity and inclusion in business. Support organizations and initiatives that work to dismantle systemic barriers and provide resources for Black entrepreneurs.
Conclusion
Supporting Black-owned businesses goes beyond just making purchases; it involves actively addressing the challenges they face and fostering an environment of equity and opportunity. By using your consumer power wisely and advocating for systemic change, you can play a pivotal role in empowering Black entrepreneurs and contributing to a more inclusive economy.
To help support the growth and impact of Black Girls Need Sun, purchase official merch at: https://www.blackgirlsneedsun.com/category/all-products
Let’s work together to create a marketplace where everyone has a fair chance to thrive.
Comments