According to a Brookings Institute report titled “Five-star reviews, one-star profits: The devaluation of businesses in Black communities,” Black-owned businesses are WAY undervalued.
And it’s not the services or products they offer. You might be able to guess what the real issue is!
RACISM is what’s cutting Black businesses off at the knees!
“The drag of racism on an economy not only cuts into individual owners’ profits, it robs local consumers and municipalities of the amenities and services neighborhoods gain from increased revenues,” says the report.
There are two methods they suggest to fix the problem.
1. Access to Investments
“Black-owned businesses start with approximately a third less capital than their white peers and have difficulties raising private investments … Only 1% of Black business owners obtain loans in their founding year, compared to 7% of white business owners,” says Brookings.
With more early investment, Black-owned businesses could provide better quality services AND more jobs for the community. But that’s not all.
2. Education & Networks
Entrepreneurship requires a lot of applied knowledge – but we’re often excluded from gaining that info. Incubator programs, apprenticeships, and industry networks can offer invaluable industry knowledge and connections necessary for success.
These efforts require anti-discrimination and anti-racist policies, however, in order to provide REAL benefits within Black neighborhoods!