Why African American Business Is Booming (And What You Can Do To Contribute)
The numbers are in! African American small businesses had an amazing 2018. A survey conducted by Guidant Financial and LendingClub corporation found that African American businesses grew by over 400% in 2018. As minority-owned businesses are on the increase, it’s great to see that African American small businesses are getting their share of the market. It’s not just in relation to one sort of business, but whether you are looking to get fit, beautify yourself, or even if you suffered a stroke, there are more medical, beauty, health, and fitness businesses now than before.
But with every business, not just African American ones, there are the typical issues that are commonplace. When it comes to looking for the right employees, maximizing sales, and even acquiring money, the problems are across the board. But the latter, financing, is even more difficult to come by in African American businesses. Minority-owned businesses received lower loan amounts, as such, there was slower growth, fewer employees. African American businesses struggled to acquire capital despite the amazing growth. What can we due to ensure that African American businesses continue to boom, and how can we contribute to this?
Continued Leverage Of Black-Owned Businesses
There are entrepreneurs and governments doing their best to improve the momentum of black-owned businesses. In February 2019, the first ever Texas Black Business Week was launched. This was to celebrate Black History Month, and there is more support to preserve black-owned businesses. In Oakland, California, a business district has been set up to support, not just business owners, but black artists as well. There is more of a push to help consumers sort out black-owned businesses so they can purchase from them. This has been evidenced in marketplaces like Black Wall Street, or Bburb. These have popped up specifically to help customers allocate black-owned businesses.
There are plenty of grants out there that provide money to minorities. But they can seem few and far between. While there are organizations like the up community fund, the money allocated to minority-owned businesses pales in comparison to money for the large scale businesses in the grand scheme of things. While female entrepreneurs are catered for, there is still an issue as far as African American businesses are concerned.
Pushing The Niche Sectors
But what does this mean for the up-and-coming entrepreneur that’s trying to find their way in an overcrowded marketplace? As is the age-old adage of setting up a business, it’s about pushing towards the niches. It’s argued that there are only a handful of niches that yield any sort of profit now, and it’s down to the individual entrepreneur to keep their ear to the ground. But while many go for the affiliate marketplaces, or focusing on content, the medical industry is still an untapped well of profit and potential. We only have to look at ongoing healthcare in America to see exactly why healthcare startups are in abundance. And even in medical diagnostics or pharmaceutical research, isotopes and the isotopic enrichment meets the highest standards in a laboratory setting, contributing to efficient chemical reaction mechanism research. And while this may sound Greek to the average entrepreneur, the lesson is simple, there is untapped potential for profit in so many areas across the medical industry.
We have an abundance of healthcare specialists that are desperate for funding so their business can fly, and when it comes to business for the African American market, while there has been a 400% increase African American businesses, it seems that the health, beauty, and fitness areas are more likely to be the type of business set up. As such, if any aspiring African American entrepreneur is to make headway in the modern business world, a niche industry is essential.
Why Hasn’t There Been More Investment In African American Business?
This is the major question. There are arguably numerous reasons. Unfortunately, it’s a question that needs to be asked. While the 400% increase is amazing, the fact that there are limited financial resources means that if there was adequate investment in African American businesses, then surely the trend would increase and improve? Unfortunately, there could be a number of reasons why there isn’t more investment; it could be the age-old prejudices, or it may just be a sheer amount of ignorance. After all, we live in a world where it’s everyone for themselves. From the perspective of any major financial institution, it makes more sense to invest in companies that have a significant track record. And while African American businesses are booming, arguably in the beauty, health, and fitness sectors, for those that want to acquire a profit on their own terms, and niche is essential, but it’s not a guaranteed profit. While there’s an amazing result in the fact that there are more African American businesses making their way in the world despite these financial obstacles, if we are to work better at getting the business is out there, this means that it’s not a case of businesses being owned by a minority. But finally, these businesses are going to be part of the traditional networking industries.
It looks like common sense for investors to put their money into African American businesses right now because we are an untapped well of potential. The sheer grit and determination displayed by these African American businesses highlight one thing: the sky’s the limit! If the financial obstacles were to be removed, the business will boom in every single industry. What can we do to help this along? As budding entrepreneurs and business owners, if we work at getting the name of the good African American businesses out there, and we highlight that, despite the financial obstacles, we are able to be equals to everyone else, the potential is limitless. It is our time to contribute to the market, not just to serve our own, but in order to make sure that every African American business gets their share of the pie. We are now on the precipice of change, so let’s get to it!