The Importance of Supporting Black-Owned Businesses

Guest Posts Hub — Wed, 27 Nov 2024 18:31:22 +0000

Being able to make money at something you’re good at, or capitalizing on your knack for creating opportunity are the hallmarks of the American Dream. Unfortunately, the rules on how to accomplish the dream haven’t been the same for everyone. Supporting black-owned businesses not only benefit underserved communities but also raises the standards that dictate how business is done. Black-owned businesses have come a long way over the past century but there’s still a long way to go.

Diversity in the Business World Helps Close the Gap

As of 2022, there are 33.2 million small businesses in the United States, with small businesses making up 99.9 of all U.S.-owned businesses. Minority ownership accounts for a mere three percent or one million businesses. Considering the role social exclusion has played in the history of black-owned businesses in this country, it continues to influence who will and will not survive in the world of business. Supporting black-owned businesses can help close this opportunity gap, which has existed since the birth of this country.

With over 7.5 billion people in the world today, it can be easy to forget that we all came from the same two parents, eons ago. Diversity in the business world encourages diversity across all areas of society. And the more contact we have with one another, the more alike we seem to each other. By taking steps to bridge today’s racial divides we get closer to being like the brothers and sisters who grew up together in the Garden of Eden.

Reasons to Support Black-Owned Businesses

1. Creates Jobs Where They’re Needed Most

Bank loans and investor capital may be accessible to the majority of business owners in the U.S. but these routes are not the norm for many black-owned businesses. Rather, many black business owners operate as sole proprietors, relying on their credit cards and savings accounts to start, maintain, and grow their businesses. Not surprisingly, these limitations affect their ability to pay employees and hire new employees.

As good as the economy was in 2018, unemployment rates for African Americans still doubled that for white Americans. Part of the reason for this has to do with “location, location, location” in that small businesses tend to hire people from their local communities. This means more black-owned businesses in a community may well translate into lower rates of unemployment within that community.

2. Helps to Close the Racial Wealth Gap

Entrepreneurship and wealth-building tend to go hand-in-hand. When roadblocks exist that prevent certain people from acquiring wealth, a vicious cycle of racial disparity is set in motion. Jim Crow-era laws, such as the 1935 Social Security Act, denied coverage for jobs that were mainly filled by African-Americans and set eligibility requirements for residency and payroll records that made it impossible for most blacks to qualify. Today, the wealth gap is as wide as it’s ever been with one out of every four black households having a net worth of zero or negative worth.

Economic hardship is a key contributing factor for alcohol abuse, which might account for why corner stores that sell alcohol seem to survive much longer than other types of businesses in underserved communities. Alcoholism and drug abuse open up yet another area of disparity when it comes to being able to access alcohol rehab programs. This only adds to the downward spiral that poverty has become. By supporting black-owned businesses, you can help nullify the effects of racial disparity and help close the wealth gap.

3. Makes Other Companies More Accountable

While businesses have come a long way since the days of Jim Crow, there are still a few that choose to perpetuate stereotypes and policies that support social exclusion. Questionable hiring practices, offensive merchandising, and the causes these companies support only continue the cycle of racial disparity.

When you support black-owned businesses, you’re using your dollar to curb the effects of corporate discrimination, and as we all know so well, money talks. When enough people support minority-owned businesses, other companies are held to a higher standard.

How to Find Black-Owned Businesses

You can’t support black-owned businesses if you don’t know where to look for them so here are a few tips to get you started:
Official Black Wall Street offers a directory of black-owned service- and product-based businesses in your local area.
If you’ve got a taste for soul food or ethnic cuisines, check out EatOkra where you can find black-owned restaurants in different cities.