August is National Black Business Month, a time to recognize and celebrate the important contributions from Black-owned businesses. As we approach Black Business Month, more people are looking for ways to support Black communities, and according to a new survey, 75% of Black small businesses have seen an uptick in customers since the beginning of June. While the increase in business has been welcome, particularly in light of the devastating economic impact of COVID-19, the study also reinforced the inequities that Black entrepreneurs continue to face.
A Groupon and National Black Chamber of Commerce survey of more than 400 Black small business owners found that 75% have seen an increase in business since protests sparked by the death of George Floyd began. (Graphic: Business Wire)
The poll, commissioned by Groupon (NASDAQ: GRPN) and the National Black Chamber of Commerce, surveyed more than 400 Black small business owners to better understand the challenges they face, why they decided to become entrepreneurs, how they achieved success and the most important issues they want to see addressed in the 2020 presidential election. Additionally, Groupon is announcing a month-long series of virtual events hosted in partnership with its home state, the state of Illinois, to shine a light on challenges faced and to find ways to support Black-owned businesses across the country.
“We’re thrilled to celebrate Black Business Month, founded by our board member and former chairman, Fred Jordan from San Francisco,”said Larry Ivory, current chairman of the National Black Chamber of Commerce.
According to the business owners who participated in the survey, 80% said they faced more challenges launching their businesses due to their race. Nearly 60% of respondents said they experienced some form of racism or bias, and half of the survey participants said that the government stood in their way when it came to opening their businesses. Approximately three out of four Black business owners said that they’ve had fewer chances due to a lack of capital investment and resources.
Disproportionate COVID Impact
The disparities between Black and white-owned businesses were highlighted by the devastating economic impact of COVID-19. While 76% of Black-owned businesses said they were negatively impacted by COVID-19, only 5% of those that applied for a Paycheck Protection Program loan received one. According to the National Bureau of Economic Research (NBER), as many as 41% of Black small businesses were forced to close permanently due to COVID-19 compared to just 17% of white-owned businesses.
Becoming the Boss
Seventy-nine percent of survey respondents said they’re more proud than ever to be a Black business owner. Black business owners said that pursuing their passions, gaining more control over their futures, being their own bosses, having flexible schedules and helping their local communities were the top five reasons why they went into business for themselves.
Nearly half (47%) of the survey respondents said it took between three and six years for their businesses to get off the ground and become successful. While 84% said they were held to a different standard than other ethnicities, putting in hard work, taking pride in the quality of their product or service, having an innovative business idea, hiring the right people and building strong community relationships were identified as some of the keys to their success.
Making Their Voices Heard in the 2020 Election
Most Black business owners, 74%, are hopeful about the future of race relations in America, but they still want to see the issue addressed by the 2020 U.S. presidential candidates. The top issues that Black business owners want to see addressed in the 2020 campaign are race relations, small business support, police brutality, the economy and healthcare.
Groupon, which has seen searches for Black-owned businesses increase more than 300% on mobile since early June, is urging consumers to celebrate National Black Business Month by supporting businesses in their local communities as well as by making a donation to help provide new Black entrepreneurs with much needed access to capital. The company has a curated collection of hundreds of Black-owned businesses across the United States and will be featuring these merchants across its mobile, online and social channels throughout the month of August. In addition, the company has partnered with Kiva.org–a renowned crowdfunding platform––to raise funds from consumers in support of a Black-owned business fund that will help create opportunity and unlock investment capital for Black merchants across the U.S.
Mr. Alford is the Co-Founder, President/CEO of the National Black Chamber of Commerce®. Ms. DeBow is the Co-Founder, Executive Vice President of the Chamber.