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Empowering Black Businesses: Understanding the Challenges

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The Struggles of Black-Owned Businesses

According to Boyce Watkins, the founder of the Black Business School, a staggering 86% of Black-owned businesses fail within the first five years. A significant factor contributing to this alarming statistic is the lack of support from potential Black customers. While there are various reasons for the struggles faced by these enterprises, Black entrepreneurs operating in a predominantly White capitalist society require backing from individuals who share their backgrounds to navigate the common challenges of business ownership. Issues such as insufficient funding, inadequate staffing, and limited business knowledge are prevalent. Nevertheless, Black business owners often encounter unique obstacles that can feel insurmountable.

I once operated a raw vegan restaurant in West Hollywood for four years. Starting at the age of 28, I relied on a mix of personal savings, investments, and credit cards to launch my venture. I believed that having a unique offering, youth on my side, and being situated in LA would foster business success. Initially, I partnered with a more experienced White business associate, but our partnership dissolved after the first year, leaving me as the sole owner.

During my time as the sole proprietor, I faced numerous challenges while managing a team of approximately ten employees. I handled everything from updating the website and processing payroll to marketing, managing deliveries (before services like DoorDash and Uber Eats existed), attracting investors, and even rolling up my sleeves to cook and clean.

As a young Black female entrepreneur, I often felt isolated and unsupported. A fellow Black alum suggested I repaint the restaurant to attract more customers but left without making a purchase or offering assistance. Another Black customer frequently ordered our popular seaweed salad, only to critique my recipe the next day, insisting it should mimic her homemade version. Repeatedly, I found that my harshest critics were Black customers who seldom offered constructive support—this was disheartening.

In contrast, I found guidance and encouragement from Orean Thomas, a Black mentor who was a pioneer in the vegetarian fast-food scene. With over 25 years of experience, he recognized the hurdles I faced and offered invaluable advice. He proudly acknowledged the diversity of my staff, which included Black, White, Asian, and Latino employees. Tragically, we lost touch, and I learned of his passing last year, but his spirit of entrepreneurship inspired me throughout my journey.

Understanding the reasons behind the failure of Black businesses is crucial as it highlights the collective effort required to build wealth. Wealth is not solely an individual achievement; it is often inherited and necessitates cooperation within a community. The success of Black businesses has historical precedence, evident in the hair and restaurant industries, as well as in the realms of sports, music, and entertainment. While these sectors have thrived, diversifying business endeavors is essential for fostering political, economic, and social power globally.

Black business owners are human and will inevitably make mistakes, yet they often face more severe repercussions than their counterparts. Many Black individuals have sworn off supporting certain businesses due to a single misstep or higher prices compared to non-Black establishments. For example, I consistently choose to support Hafiz Sisters Beauty Supply, a Black-owned hair care store, even if it means sacrificing convenience or facing higher prices. This choice reflects my commitment to supporting Black entrepreneurship.

Similarly, I faced a tax mishap with a Haitian-owned tax service. Instead of abandoning them after an error, I acknowledged their apology and continued to utilize their services. Disavowing Black businesses for making mistakes perpetuates a cycle of self-hate rooted in oppression. I have had negative experiences with major corporations like Verizon and Target, yet I remain a customer.

In a thought-provoking Youtube short, Berel Solomon, a Jewish business consultant, discusses the reasons behind the success of Jewish businesses. He highlights how Jewish communities come together to support one another, ensuring the success of new ventures, regardless of initial quality. This community-driven approach fosters resilience and long-term thinking, which Black communities can emulate to change their economic landscape.

My restaurant journey lasted four challenging years, which is notable considering the common expectation for restaurants to endure only six months. Lacking venture capital, business degrees, or prior experience, I represent many first-generation Black entrepreneurs. While comparisons across racial lines are complex, we can learn from others to enhance our economic prospects.

6 Strategies to Support Black-Owned Businesses

  1. Reside in Black Neighborhoods: Many upwardly mobile Black families move out of predominantly Black areas, often believing that this choice leads to better schools and safety. However, this distance can hinder their ability to support local Black businesses.
  2. Prioritize Purchases: Buy from Black-owned businesses even if their products are pricier or of lesser quality. For instance, I purchase activewear from Actively Black, a premium brand, understanding the long-term benefits of supporting Black entrepreneurship.
  3. Offer Constructive Support: Instead of critiquing, consider volunteering time or providing mentorship to Black business owners. Many are first-time entrepreneurs, and guidance from experienced individuals can make a significant difference.
  4. Promote Within Your Network: Share information about Black-owned businesses with family and friends, and leverage social media to raise awareness. I often encourage others to purchase gifts exclusively from Black businesses, regardless of their reactions.
  5. Think Long-Term: Supporting diverse Black-owned businesses strengthens the community and enhances political and economic power, ultimately creating more opportunities for future generations.
  6. Shift Perceptions: Challenge the tendency to idolize luxury brands that lack representation and do little for Black communities. Instead, promote and celebrate Black-owned brands through the same channels.

Writer's Bio

Nwenna Kai is the former founder and owner of Taste of the Goddess Cafe, a raw vegan restaurant in Los Angeles. She has authored two books: "The Goddess of Raw Foods," a raw vegan cookbook featuring over 75 recipes from her restaurant, and a children’s book, "The MoreLoves: Baba Builds a Sun Oven," which narrates the adventures of a health-conscious Black family in rural Pennsylvania. Her work has been featured in various publications, including Obsidian: Literature and Arts in the African Diaspora and Aji Magazine. More about her journey can be found at www.nwenna.com.

This video discusses the challenges faced by Black businesses and the internal and external factors that contribute to their struggles.

This video explores how supporting Black-owned businesses can lead to economic development and community empowerment.

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