75% of Black Business Owners Have Seen an Increase in Business in Recent Months, Study Says
The findings come in light of recent Black Lives Matter protests across the country, which grew following the death of George Floyd while in police custody on May 25
A staggering 75 percent of Black business owners have seen an increase in business since the beginning of June, according to new research conducted to coincide with National Black Business Month, a time to recognize and celebrate the important contributions from Black-owned businesses.
The poll of more than 400 Black business owners comes as a result of the recent Black Lives Matter protests across the nation and across the world, prompted by the death of George Floyd while in police custody in Minneapolis.
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.
And, COVID-19 didn’t make matters any better for Black business owners. Seventy-six percent reveal COVID-19 has been detrimental to their businesses, while just 5 percent of those that applied for the Paycheck Protection Program (PPP) loan say they received one.
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The study, commissioned by Groupon and the National Black Chamber of Commerce, aimed to better understand the challenges Black business owners face, why they decided to become entrepreneurs, how they achieved success and to find ways to support Black-owned businesses across the country.
Sixty-five percent say they wanted to pursue their passion, while a further 63 percent started their business to have more control over their future career.
Another 47 percent of those polled became entrepreneurs to have a flexible work schedule, while 63 percent of the Black business owners surveyed wanted to be their own boss.
Eighty percent of Black business owners say they faced significantly more challenges getting their business off the ground due to their race, and 85 percent say they had to overcome more obstacles than their fellow business owners who were not Black. Fifty-nine percent report being victims of racism or bias when starting their business.
Besides racism and bias, three in five of the Black business owners say they struggled with being taken seriously, while a further 63 percent of Black business owners had difficulty accessing capital compared to their non-Black business-owning counterparts.
Half of the Black business owners studied had a hard time building a support network, while a further 27 percent struggled with owning their accomplishments — something their non-Black business owners didn’t necessarily have to overcome when creating a successful business.
Additionally, one-third (33 percent) of those surveyed say they had trouble obtaining access to various government programs when trying to get their business off the ground.
Half of the Black business owners surveyed feel like their state and local governments made it even harder for them to get their business up and running successfully.
Seventy-four percent say that they’ve had fewer chances to create a successful business and less time to make it successful due to a lack of capital investment and resources.
And 84 percent of Black entrepreneurs say they are held to a different standard than other ethnicities.
However, despite the struggles and obstacles, nearly 80 percent reveal they are proud to be a Black business owner in America — now more than ever before. Seventy-four percent of Black business owners said they are quite hopeful about race relations in America as a whole.
One Black business owner surveyed said they’re hopeful about gaining new customers in the near future, while another expressed hopefulness about equality and growth.
“We’re thrilled to celebrate Black Business Month as this community has been disproportionately impacted by COVID-19 and traditionally suffers from a lack of access to adequate capital and resources,” said Aaron Cooper, Interim CEO, Groupon. “One of the many ways that we’re translating our support for Black Lives Matter into meaningful action is by highlighting and championing the success of Black-owned businesses and connecting them with our diverse customer base. We hope that everyone will join us in the cause of supporting the more than 2 million Black-owned businesses in this country at a time when they need us the most.”
Top 5 Reasons Black Business Owners Started Their Own Business:
1. To pursue their passion: 65%
2. To have more control over future career: 63%
3. To be their own boss: 63%
4. To have a flexible work schedule: 47%
5. To help their local community thrive: 42%
Top 5 Challenges Unique to Black Business Owners:
1. Being taken seriously: 53%
2. Access to capital: 50%
3. Defying social expectations: 46%
4. Building a support network: 40%
5. Owning their accomplishments: 34%