In February, you’ll see a lot of people on social media and elsewhere urging you to Buy Black and purchase goods and services from Black-owned businesses. And that’s great! Let’s normalize supporting Black entrepreneurs beyond Black History Month.
But as the co-owner of a Black-owned firm for two decades (TheMoneyCoach.net LLC, a financial education company), I can tell you something unequivocally: We need to actively support Black small business owners all year long.
According to research from McKinsey & Company, 20% of Black Americans start small businesses, but only 4% of them survive the startup phase.
Knowing these statistics makes me especially grateful for my company’s prosperity, and for the longevity my husband, Earl, and I have enjoyed in our business.
However, we’d love to see more Black-owned firms make it to five, 10, or 20 years or more. How about those of us who are Black owners passing on our companies to the next generation too? That’s goals!
The number of Black-owned small businesses in America currently stands at 2.6 million, representing 8% of all small businesses in America, the U.S. Census Bureau reports.
Despite this impressive figure, Black business owners still face significant challenges when it comes to accessing capital and resources. This is just one reason why it’s so important to support Black-owned businesses (including those within the African diaspora) whenever possible.
Lifting up Black creators, Black brands and Black business owners has numerous benefits, to individuals and communities – as well as to America’s larger economy.
Here are a host of reasons you should Buy Black.
1. To circulate dollars within Black neighborhoods
When money is circulated within the Black community through a Black-owned business, it creates jobs, increases wealth, and helps to close the racial wealth gap.
2. To create more Black millionaires
According to a report from the Federal Reserve Bank of St. Louis, only 4% of Black households have a net worth of $1 million or more compared to 17% of white households.
3. To increase access to capital for Black entrepreneurs
When business owners seek loans or lines of credit, one of the first questions they get asked is about their sales or revenues and their net profits. The higher their revenues and profits, and the more financially secure the business, the more likely they are to get financing and loans need to expand or scale a Black-owned firm.
4. To help create jobs in the Black community
Job growth is vital among African American households because it provides a pathway to economic stability and financial security. Job growth can help African Americans build wealth, which in turn can be used to invest in their communities and create generational wealth. Additionally, job growth gives African Americans the opportunity to gain skills and experience that will help them advance their careers and become more competitive in the job market.
5. To support Black entrepreneurs who are innovating in their respective industries
Innovation and creativity are at the heart of what many entrepreneurs do — especially for those launching startups or those trying to take their companies to the next level. They want to do something better, faster, cheaper or more efficiently than others. Particularly among Black-owned brands, and company founders who attended Black colleges, a lot of the innovation and creativity is based on cultural competence and knowing their target market’s needs in a way that competitors don’t.
6. To show solidarity with the Black Lives Matter movement and other social justice initiatives
In recent years, Black Lives Matter has gone beyond being a rallying cry and a movement for social reform — on issues like police brutality or the prison system. In a larger context, Black Lives Matter helped further raise awareness about ALL the ways in which inequities exist, including economic inequity. Those who align with the concept of social justice and promoting financial equity should also rally behind the idea of patronizing and amplifying Black-owned businesses.
7. To help ensure that Black voices are heard and represented in business
It’s good practice for all small business owners to join their local Chamber of Commerce. We are currently members of the Greater Houston Black Chamber of Commerce, which advocates for its members’ needs, puts on quality programming to help entrepreneurs grow, and helps Black businesses win bids and contracts. But even joining groups like Chambers cost money. So buying Black and patronizing Black owners allows these entrepreneurs to more readily network at the professional level.
8. To help close the Black-White wealth gap in the U.S.
Unfortunately, the average Black household in the U.S. has only a fraction of the wealth that White households have. According to the Federal Reserve, the average net worth of a White household is eight times that of the average Black household. By supporting Black-owned businesses, we can help close this wealth gap.
9. To help create economic opportunities for all BIPOC individuals
When we support Black-owned businesses, we are helping to create economic opportunities for African Americans as well as other people of color who may not have access to the same resources or opportunities as their white counterparts. By investing in Black-owned businesses, we are helping to close the racial wealth gap that exists in our society for Black, Indigenous and People of Color of all backgrounds, including Latino, Asian and Native peoples.
10. To support Black-Owned businesses making a difference in underserved communities
Many Black-owned business owners are mission-driven. They are using their businesses to make a positive impact in their communities by providing jobs, donating to charitable causes, volunteering, and more. In every industry and sector of the economy, there are Black-owned SMBs (Small to Medium-Sized Businesses) that need your support to continue the great work they are performing, both within these Black-owned employer firms — as well as in the communities in which they operate or have influence.
11. To promote homeownership in the Black community
Currently, only about 44% of Black people in the United States own their own homes, compared with a a homeownership rate of roughly 74% for White people. Buying a home is increasingly a challenge for all Americans — but especially for Black people who already typically have lower incomes and more difficulty accessing credit and loans.
Doing well in a business, however, can give a Black individual, couple or family a better shot at homeownership — simply because they may be able to better generate the type of income a lender would require to approve a mortgage. It’s worth noting, too, that 69% of all startups and 50% of all small business overall in America are home-based businesses.
12. To promote greater opportunity and a more just society
America is known as the “land of opportunity.” And there’s no question that Americans enjoy many benefits, opportunities and privileges that others around the world don’t have. However, while talent is equally distributed, opportunity isn’t. Marginalized groups like African-Americans have not — in historical or present terms — had the same opportunities for advancement as White Americans have had in the United States.
13. To help create a more diverse, equitable and inclusive economy
We need an economy that works for all – not just for certain groups. This means creating an equitable and inclusive economic system that provides opportunities for everyone to succeed, regardless of their race, gender, or background. One way to do this is by supporting Black-owned businesses and buying Black.
A more diverse and inclusive economy is beneficial for everyone, as it allows for different perspectives to be heard and valued. This can lead to new ideas, products, services, and solutions that benefit the entire population.
14. To reward exceptional Black talent and professionals
What better way to honor, thank and reward a Black entrepreneur for a job well done than to patronize their business again and again, or to refer others to them? Black creators and those providing products and services of all kinds truly win when we boost their profiles publicly — shouting them out on social media for example — and privately, by doing business with them and purchasing their offerings.
But don’t just give flowers to the business owners with good visuals — or the ones that make YOU look good. You know what I mean: the ones you can tag and take an Instagram-worthy picture of to post to your friends, family and followers on IG or Facebook. By all means, recognize those sisters who sell you beauty industry glam products, coconut oil or that popular hair service for all hair textures — right along with the brother who’s your personal trainer and whipped you into shape. Just remember also to elevate the Black plumber, pest terminator or electrician you used. Sure, that’s not as glamorous. Yet, all of these Black business owners really need and appreciate your support.
15. To help counteract systemic racism and financial inequality
Racism in America has lasted for centuries. it dates back the inception of slavery on these shores in 1619, continued during the Antebellum period from 1812 to the start of the Civil War in 1861, and remained during the Reconstruction era following the Civil War, from 1865 to 1877.
Even after Black people were supposedly “free” following the Civil War, the Jim Crow era lasted for some 100+ years, from around 1865 until 1968, a period when it was legal to discriminate again Black people in various ways in housing, employment, education and more. The impact of slavery and subsequent forms of White privilege, can’t be overstated. Even today, segregation can be seen and felt in school districts, housing and Corporate America, where the upper echelons of management are overwhelming White.
Launching, growing and sustaining Black business is, in some measure, an antidote to this reality.
16. To empower Black individuals and families
Strengthening Black households with a solid economic base by virtual of a successful Black business goes a long way toward keeping Black couples together and maintaining Black family stability. After all, many couples who divorce cite financial problems as one of the main factors in their breakup.
17. To reduce the Black-Owned business failure rate
No one should want to see well-performing and much-needed Black-owned firms, Black creators, sole proprietors or Mom-and-Pop enterprises go out of business.
Yet, without customer and client support, many Black businesses fail — sometimes before they fully get off the ground. The Black community has long been underrepresented in the business world, and this lack of representation has had a significant impact on the economic success of African Americans. Unfortunately, many Black-owned employer firms are also unable to stay afloat due to limited access to capital and resources, as well as systemic racism.
18. Buy Black to practice Ujamaa, or cooperative economics
Ujamaa is an important principle of African-American culture that encourages people to support and invest in Black-owned businesses. Ujamaa, one of the seven principles of Kwanzaa, promotes economic self-sufficiency and collective prosperity within the Black community. Anytime you patronize Black businesses — say, a Black-owned coffee shop or Black-owned restaurants; or a Black proprietor with a retail store front or an online shop — you’re practicing cooperative economics.
19. To boost America’s GDP (Gross Domestic Product)
According to an analysis from McKinsey, if America closed the Black-White wealth gap in the U.S., we could increase GDP in America by $1.5 trillion to $2 trillion over the next 10 years.
The economic power of Black Americans is undeniable, and when Black people are given the opportunity to succeed, everyone benefits. If Black entrepreneurs and the workers they hire are more financially stable, as a result of operating and working in thriving businesses, all these individuals are better positioned to save, spend and invest in ways that boost the economy.
20. Buy Black to promote financial freedom and independence for Black people.
It’s liberating to NOT be reliant on a job or corporate employer, the government, or any one else. Successful entrepreneurship among Black business owners can facilitate this freedom. By patronizing Black-owned businesses, whether it’s a gift shop in North Carolina, or a Black-owned Brooklyn or San Francisco deli, you are taking a powerful step toward advancing the cause of financial freedom for a Black business owner.
Related Articles:
6 Smart Easy Fun Ways to Buy Black
5 Financial Lessons From 5 Great Black Leaders
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