Black Owned Businesses: Why and How You Should Support

Mural near downtown Oakland

In the wake of a global pandemic that has disproportionately impacted Black Americans and repeated acts of police brutality against people of color, a renewed sense of awareness around systemic racism in the United States has emerged. As a result, activists have been calling for consumers to purchase from Black-owned businesses in an attempt to combat the racial injustices suffered by the Black community. 

These injustices take shape in various forms, including in the business realm itself. Black-owned businesses face more obstacles in creating and growing their businesses due to struggling to attain loans from the bank and securing capital and investors. Approximately 4.3% of the 22.2 million businesses in the U.S. are Black-owned, and less than 1% are generating a median profit margin greater than 20%. This is significantly less than the 40% of businesses operating in predominantly white areas that meet this threshold. 

The disparity between experiences of different races has been exacerbated by COVID-19, with the pandemic causing 41% of Black-owned businesses to shut down compared to 17% of white-owned businesses. Despite the attempt to keep business afloat through the CARES act, numerous minority-owned businesses have struggled to utilize federal-aid programs.

Supporting Black business owners may be one of the keys to closing the racial wealth gap. Doing so maintains a positive cycle of allowing businesses to grow, and thus, creates the need and capability to hire new employees. This cycle supports the surrounding community through opening up new jobs and boosting the local economy. Additionally, seeing representation may encourage young children or other BIPOC aspiring business owners to begin businesses of their own. This will further diversify the economy and allow for more Black representation in the market.

Another benefit that arises through supporting Black-owned businesses is the celebration of Black culture. A common objective for Black entrepreneurs to create their own products and open their own businesses is to provide products and services that are staples of their own cultures. From restaurants to hair products, supporting Black entrepreneurs over chain companies and large corporations allows the profits to fund businesses that authentically honor and respect Black culture, rather than attempt to profit off of it. 

Additionally, Black-owned businesses fill gaps in the market, such as the unacceptable racial segregation propogated by hair salons. This problem stems from the standard beauty school curriculum, which does not require stylists to learn how to work with all types of hair, including the kinds common among Black women. Therefore, Black women are often turned away from salons that do not service textured hair types. In addition to urging salons to hire stylists trained to work with Black hair and making curriculum changes in beauty schools, it is also important to support Black salons offering this service to the Black community. 

Supporting Black-owned businesses is not only a means of putting an end to racial injustice, but environmental injustices as well. According to the NAACP, environmental injustice has a greater impact on low income communities and communities of color. Environmental racism, or the phenomenon where people of color are more likely to be exposed to environmental health problems, is evident throughout the U.S. from the poisoned tap water in Flint, Michigan to the frequent location of hazardous waste facilities in BIPOC communities. 

The Proceedings of National Academics released a study that found Black and Hispanic communities in the U.S. breathe in around 60% more air pollution than they generate, while  white people and other races faced 17% less exposure to air pollution than the amount they produced. It was also discovered that communities of color were much more likely to be living near air-polluting facilities, exposing them to higher concentrations of  fine particulate matter. Poor air quality is linked to cardiovascular and respiratory conditions and also increases the chances of dying from COVID-19.

Environmental racism also affects  Black communities financially. According to the paper Estimating Economic Damage from Climate Change in the United States, climate change will economically harm lower-income counties in the U.S. the most, with many of those being home to primarily communities of color. 

Therefore, at the very least, supporting Black-owned businesses will allow individuals and communities to attain the resources necessary to overcome not only wealth inequality, but also environmental injustices. There are many ways to uplift Black-businesses through these challenging times. One simple action is shopping at Black-owned stores and buying products from Black entrepreneurs. For a list of Black-owned restaurants in the East Bay, ranging from bakeries to wineries, browse through Berkeley Side’s compilation of local businesses. UCSF also has a more general compilation of Bay Area Black-owned businesses to check out and support. 

Finally, highlighting and sharing Black entrepreneurs' products and services on social media platforms and by word of mouth will help them reach larger audiences and generate more awareness for the item or business. It can also be beneficial to offer services to a local Black-owned business, such as if you or someone you know can provide  painting or electrical work. Sharing resources Black business owners can utilize, including  the resources offered by Local Initiatives Support Corp (LISC), Hello Alice, Finli and the National Business League, is another great way to contribute. Through these simple actions, everyone can help empower Black businesses and take a stand against racial injustice.