Business Minded: Black Entrepreneurship
Over 81% of businesses are owned by White entities in the United States according to Rolling Out. The next 15% are owned by Asians and Hispanics. That means that almost less than 5% of businesses are owned by Black people. According to Fortune, Black people make up about 14% of the population and have around $1.2 Trillion in spending power. But what this really means is that we are investing in other companies other than our own considering we only own about 5% of the business market.
Why aren’t more Black people in business and when they are, why do they fail? We all understand that most businesses will fail almost 80% of the time during their first 1 to 5 years, but Black businesses are failing at exponential rates. After reading a few articles that listed why Black businesses fail, three things stood out to me the most; lack of customer service, lack of financial education and lack of support.
Customer service is huge. Although many companies lack customer service, Black people are stereotyped as the worst for having poor customer service. Good customer service can take a business very far. It is about the customers, efficiently catering to their needs, satisfying their requests and making sure their demands are a priority to your business. It involves being kind, resolving conflict in a friendly manner and showing that you care for them and value their business. Customer service outweighs how well someone provides a service. Most people prefer to be treated well. I believe the culprit is that being nice and approachable to people is considered a White trait. The reality is, being a good person will get you much further in life and it does not have a color. We need to instill customer service skills in our youth so they grow up to display positive behaviors. Being pleasant is essential in owning a business.
Most companies fail because they lack capital. Plain and simple, we lack financial literacy. Too many Blacks don’t understand credit scores, interest rates and investment options. We are not taught this in school and since most of our family does not own a business, the knowledge is not transferred to us either. We usually have enough money for the first year or so, but then it runs out and the company fails. We need more financial literacy programs to educate potential business owners. Tia Chambers created Financially Fit and Fab. Check her out to learn more about financial literacy. It’s a shame this isn’t taught in school, but then again, school teaches us how to work for someone else. It is in the best interest of promising business owners to find literature on how to prepare for owning a business instead of just diving in head first.
Black people lack support because we lack family morale. It’s not a secret that other minority groups have tighter family ties and work with one another. Slavery has made many Black people competitive and only want to be responsible for themselves. We don’t collaborate well out of fear that someone may steal our ideas or do it better than us. The first step in this healing process is to make our families whole again; two can do more than one. While one is building an empire, the other can financially support them. The second step is to learn how to value other Black people and look at ourselves as one. Other races do this quite well and help each other just because they are cut from the same cloth, but Black people do not do this. We judge each other more harshly than other cultures and do not support each other’s endeavors. People are quick to shop at Gucci, but refuse to look at their best friend’s new clothing line. We must support each other. We also have to learn to collaborate and delegate as it is difficult to start a business alone.
Not only do we have a hard time supporting our own businesses, we continue to support brands that treat us bad. We would rather be treated poorly than patronize our own business. One reason for this is because Black business has a negative connotation. One automatically assumes they have terrible attitudes and subpar products. We even think this about ourselves and is the reason why we don’t value each other. We’re afraid that if we utilize a Black business, we are doomed to have bad service. As mentioned before, we have got to eliminate our stereotypes for nasty attitudes and poor services. This means being on time, delivering as promised and being courteous and considerate throughout the service process. Hopefully in the future we can turn this around and start a new Black-owned community with flourishing businesses.
I always wondered how it’s possible for other ethnicity groups to come to America, retain their culture and start a profitable company. Asians have taken over the beauty market. Arabs have taken over the gas industry. Whites have taken over goods, services and fashion. Mexicans have created neighborhoods, restaurants and grocery stores. But what have Black people accomplished as a whole in the business industry? Nothing. We just complain when schools leave our neighborhoods, but never build and own them. We complain when businesses leave the area and there’s a lack of work, but don’t start businesses to replenish revenue. We complain when we don’t have access to grocery stores, but don’t build one that can withstand time. We need to collaborate as an entire community and rebuild our neighborhoods. We must stand as one as we get into entrepreneurship and start owning businesses.