Journal logo

Why Your Black Business "Won't Survive"

by C Alexandra 4 years ago in business
Report Story

A Long Time Debate Between Oppression and Self-Reflection

Black in Business: A Perspective with Andre Walters. The following article does not reflect the above interviewees views. One follows a personal story, the other utilized academic journals to support stance.

Context

As I write this piece, I reflect on what brought me to the south. I lived a privileged life in California, situated in the mecca of diversity, the San Francisco Bay Area. And we can say I still live that privileged life, seeing as I can go back anytime that I want to. I was well aware of the evils of poverty and de facto segregation that lends itself to the narrative “separate but never equal.” I knew the history of internment camps in the peninsula and race riots and the establishment of the Black Panthers in the east bay. Growing up we learned about the racist Jim Crow like laws forced upon the Chinese, and we learned about the Chicano movements of Southern California. I was surrounded by whites, Asians, Hispanics, Pacific Islanders, few blacks, and an increasing population of Middle Easterners. And I got to be at the center of the Pride movement every single year. And I grew up with the notion that the south was evil, racist, and not somewhere I wanted to go.

Fast forward to the African American Cinema course taught by Dr. Frederick Gaines at the College of San Mateo, where I learned everything from black face to Blaxploitation to the bombing of black Wall Street.

Where I learned there was a black Wall Street.

History

Greenwood, Oklahoma was home to more than six-hundred black-owned businesses. From the early 1900s until 1921, black Oklahomans owned and operated: a bus line, six real estate companies, construction firms, more than forty grocery stores, thirty restaurants, and four hotels. Among them were wealthy black oilmen, entrepreneurs, doctors and surgeons, and millionaires, “six of whom owned private planes—at a time when there were only two airports in the entire state” (Jones, 2017, p. 324). Prior to this, written and unwritten Jim Crow laws, lynchings, and police brutality were used as economic terrorism to dissuade black business owners who presented competition to their white counterparts (p. 323). The Tulsa Race Riots, dubbed so due to their proximity to Tulsa, sparked from the allegation that a black man raped a white female elevator operator. After being taken into custody, rumors bounced back and forth between the black and the white communities. Armed black men stormed the front of the police steps where it was rumored the accused would be hung. The white community threatened by the idea of armed black men, showed up armed and in full force. Shots were fired which resulted in wounds and fatalities, and then both white men and women proceeded to terrorize, burn down, and carry out airstrikes on the city of Greenwood. Between the 1890s and the 1920s, Durham, North Carolina was also home to a black Wall Street (p. 323). Home to a life insurance company, banks, and real estate companies, all Black-owned. However, due to the severity of suffering from the Tulsa Race Riots, most learn about this particular mecca of black owned businesses and its demise.

Statistics

According to the Global Entrepreneurship Monitor report, blacks are two times more likely than whites to start a business (p. 324). Even with a tremendous amount of buying power, due to limited finances, social capital, and discrimination, “black-owned businesses [lag] behind white-owned businesses three to one” (p. 320). In Rowley’s et al. findings of blacks in business magazines, she makes a point the note how during the Civil Rights era, “Black business development had re-emerged as [an attempted] solution to the chronic under-development of the black community” (Rowley & Kurpius, 2003, p. 245). However, due to Jim Crow laws and segregation the ability to accumulate assets, which in turn give the power to partake completely in society, is near impossible when white Baby Boomers stand to inherit collectively $7 trillion as their parents’ generation dies (p. 245). In Jones’ findings, she makes note via Anderson and Gregory (2012) that, “half of all blacks in the United States have less than $6,200 in wealth, while the amount of wealth among whites and Asians is eleven time higher” (Jones, p. 322). And with less personal wealth and low asset levels, there are higher loan denials and higher interest rates in comparison to their white counterparts (p. 322).

Factors Outside of the Community

As history shows, black people succeeded on many occasions to build themselves up, only to be taken back down legally and violently by society. And present day America does the same; however, deterring black success occurs well before black men and women and children have had a chance to build themselves to a level of economic threat. As Rubin notes in his findings on franchising and improving inner city conditions, “few blacks succeeded in moving beyond menial jobs, and more find racial discrimination everywhere they go…[as] most have to leave the ghetto for their daily jobs” (Rubin, 1974, p. 279). Additional problems stem from the property black-owned businesses are operated out of. Professor Allvine of the Graduate School of Business Administration at Northwestern University notes, “the [properties] and [buildings] are normally owned by nonblacks” (Allvine, 1970, p. 2). While a portion of the money made from the business does go back into the community, in order to maintain a storefront, blacks are in debt to the property owners.

Media

Media has always been owned and operated by whites. Coverage of black business success is small which perpetuates the myth that blacks are not a part of the business community (Rowley & Kurpius, p. 246). Simply put, “If black business people and black professionals are not accurately portrayed in [the media], then it becomes more difficult for business leaders to see them as a viable part of the economic system and the mindset that has hampered blacks’ progress for decades is reinforced” (p. 246). Unsurprisingly, the white-dominated view affects the ability to cover minorities as it doesn’t match how black people see themselves. They use “racist common sense” and stories that do cover minorities fall under the ideology of threats to the social order which means viewers will see stories on crimes committed by minorities or coverage of cultural fests.

The goal of the media is to attract those with the economic means to buy their products which means “lower socioeconomic segments are excluded, including a disproportionate number of blacks” (p. 247). In addition, most journalists stem from and upper-middle to upper-class backgrounds therefore they operate under a white perspective with a set of dominant white group norms and values. It is noted that, “if minorities continue to be [both physically] absent or portrayed as absent in the mass media, it is unlikely they will be able to accumulate buying power” (p. 247), which goes along with the ability to start a business with solid financial footing. However, black magazines such as Black Enterprise, work towards the inclusion and portrayal of black success in business. Unlike Forbes and Fortune, who virtually ignore blacks and focus on accumulating more wealth, Black Enterprise focuses on small business and wealth building, touching on topics such as: affirmative action, barriers blacks must overcome, cultural expectations, economic empowerment, inspiration, racial discrimination, strengthening the black community through commerce, and the responsibility to help others in the black community along (p. 250).

The American Dream & Ageism

In both Jones, Rowley, and Kurpius’ journals they mention how the structure of the American Dream by whites is also adopted by other minority communities. The American Dream has a certain look and is composed of certain achievements, which could be looked at as achieving a spectrum of whiteness. Rubin notes the same “participation in the main-stream of American society is traditionally measured by the capacity to obtain and maintain a position which would be identified as moderate status and moderate income” (Rubin, p.278). Black Enterprise shows the black community what life could be like “if they just acquitted the right skills and worked hard” (Rowley & Kurpius, p. 250) which mimics traditional white, middle class views of the American Dream. And the abundance of literature that stresses the failure of blacks to enhance their status and wealth by working for themselves, positions blacks to look outside of their community for secure high paying jobs so they can climb the socioeconomic ladder (Jones, p. 324).

As diversity grows in media today, the images often portrayed are of young Americans and even sometimes young foreigners who afforded the American Dream. However, the images convey an idea that diversity is something for the future, which plays into the “in due time” mentality used against minorities even after they are legally afforded rights that should have put them on the same playing field as their white counterparts. When the previous generation of entrepreneurs and millionaires are largely white men, the diverse next generation still only has that to look up to.

Factors Within the Community

Psychologists and sociologists have studied how mental illness, post traumatic slave syndrome, and the mental effects of poverty have plagued the black community. These factors hinder empowerment. Empowerment is defined as how “individuals, groups and/or communities become able to take control of their circumstances and achieve their goals” (Jones, p.326). Jones argues that “black entrepreneurship is, in itself, an act of resistance, a way to work within the system to achieve cultural empowerment despite discrimination and marginalization” (p. 331). However, participant 9 of Jones study believes that within the black community, business ownership is not seen as a valid option and lack of support stems from looking at black business as a hustle and not a means to support a family (p. 331). Participant 3 mentions needing to change the stereotype of the expectation that blacks do not pay each other for their goods and services. Participant 10 breaks down the following:

“The black client is different in that we are already looked at totally different from someone else. People don’t have a problem doing business with Asian business owners. They don’t have a problem with doing business with Mexican business owners. A lot of time they’ll have a problem dealing with black business owners simply because they’re black. Black entrepreneurs know this and we feel this, so we’re cynical even to working with our own people. You have to break that cynicism number one, to get to the black client because they already think either I’m going to get someone who’s not going to do that great of a job or because they’re swindling me” (p. 332).

In order to economically empower a community there needs to be economic circulation; however jobs cannot be created within a black-owned business because of spending that occurs outside of the black community. A participant estimates the “black dollar leaves the community within three minutes” (p. 335). And the marketing money simply is not there. Economic leadership is often nonexistent in the black community, because leadership is primarily in the hands of the church (Allvine, p. 2). Rather than the clergy, black communities need leadership that is particularly skilled in guidance that reduces economic and business problems within the community. However often times, “[the] blacks with the capabilities [to run] businesses are skirting business opportunities…in favor of going into government service, teaching, or working for nonblacks” (p. 3).

Culture of the community and the notion to “make your moves in silent,” which is a popular affirmation on social media, also hinders support. One of Jones’ participants pleads,

“How do we learn from each other? For all of the businesses that are working, we are asking them to, basically, document what’s going on in your business. Document things that have happened. Document how you solve the problem so that we can come up with this series of case studies that we want to publish for other people to be able to do the same. It’s really about learning from your experiences as quickly as possible… and not being greedy with it” (Jones, p.336).

Legacy also plays a part of how the black community views themselves.

“We have to do it now to secure our future. We are losing our historically black colleges. But at this point our historically black colleges aren’t even up to par as far as I know. As our history is so engrained in what we are doing that we are forgetting the present. We have to do something now for the future. Just like those historically black colleges and the Divine Nine and all of that was started in the early 1900s. They have prepared us for now. But now is a new era, where we have to prepare for tomorrow” (p. 338).

Types of Business

Black businesses are by definition, small businesses, in contrast to the economic hold through business their white counterparts operate. Allvine notes, “Blacks primarily operate [segregated] businesses which would be difficult or unattractive for nonblacks to operate. Typically, these businesses are either too small, or involve too frequent personal contact with blacks, to be run by nonblacks” (Allvine, p. 2). Because whites control mainstream businesses such as supermarkets, automobile agencies, and contracting, within the black community as well as out of, black dollars end up directly siphoned out. If black businesses are restricted to their black communities, they will fail. Because there is already a small circulation of black dollars, white companies will have to buy black products. More companies will need to purchase black products and give assistance to black businesses (p. 7).

Black Capitalism

Alternatively, should the black community commit to not spending at white businesses or even other minority businesses, “black capitalism [could] lead to apartheid resulting in two separate economies in this country” (p. 3). Allvine does categorize the separate economies as “the prosperous white” and “the desperate black” but I disagree with that. If black people developed a large number of reasonably secure, independent, and more non-service oriented businesses, the ability to be the “prosperous black” economy is well within reach. Instead, the goal by so-called militant blacks is instead to have control over their own economic communities, but not at the exclusion of the giant enterprises of the U.S. (p. 3).

Franchises

The white power structure has not stayed out of the “ghetto.” Apartments, stores, businesses, bars, and concessions are often owned by whites from outside of the community, taking home those dollars and spending them amongst the white businesses (Rubin, p. 280). Rubin notes that the two major hopes for black capitalism are “the [improvement] of living condition and the [improvement] of personal situations” (p. 281). As more black men and women are enrolling in four year institutions and learning what it means to be a successful entrepreneur, the “difficulty to create successful [black] entrepreneurs” is no longer a relevant excuse as to why black capitalism could not work. However, franchises could alleviate the risk of failure, challenge stigmas and stereotypes, and provide more income to circle within the black community. Assuming the franchise is opened within that community, the franchisor has the ability to expand and distribute their goods or services to another market (p. 284). In order to be sensitive to the needs of the community, management and entry level positions would be filled by those in the community. Jackie Robinson once stated in support of franchises, “The franchising industry can be a big saver for minorities, as most of use recognize who have had little of any experience in business. Our group needs the training, we need the accounting advice, the legal advice, and certainly we need the continuing support” (p 284). Today, franchises are helping the franchisee secure the finances they need in order to own and operate a business. The franchisor wants to see the franchisee succeed, first and foremost because it generates more sales for the franchise as a whole. The franchisor offers continuing guidance and a structure for success. Rubin concludes, “Franchising can make it possible for the black businessman to attain financial independence, to minimize risk and investment, and maximize his opportunity for success” (p. 285). However, most franchises are also service oriented. And while becoming part of one is essentially foolproof, becoming a part of the right franchise in order to not only boost the economy of the black community but their well-being is important too.

Conclusion

As previously stated, to be a black entrepreneur is, in itself, an act of resistance. Economic, educational, and systematic disenfranchisement plague the black community. It is up to the oppressed group to negotiate how they should respond and act to those oppressive systems. Racism is a peculiar institution that must be worked around. It is important to remember resistance is not always obvious or large scale and it usually takes the form of everyday opposition actions rather than larger-scale insurrections (Jones, p. 333).

I sought to attend an HBCU with the intentions of documenting the successes of the black community so that future generations can move through society beyond their skin color. I don’t know that there will ever be a time when race isn’t a factor in how life turns out for one person as opposed to another. But I do know that unless reactions to the systems change, the cycles of oppression will continue to prevail without failure.

Jones, N. (2017). Rhetorical narratives of black entrepreneurs: The business of race, agency, and cultural empowerment. Journal of Business and Technical Communication. 31(3). 220-249. doi: 10.1177/1050651917695540

Rowley, K. M. & Kurpius, D. D. (2003). Separate and still unequal: A comparative study of blacks in business magazines. The Howard Journal of Communication. 14. 245-255 doi: 10.1080/10646170390251212

Allvine, F. (1970). Black business development. Journal of Marketing. 34. 1-7

Spratlen, T. (1970). A black perspective on “black business development. Journal of Marketing. 72-73

Rubin, R. S. (1974). Franchising: A marketing systems to improve inner city conditions. Journal of the Academy of Marketing Science. 278-289

business

About the author

C Alexandra

I'm super dramatic. Fact checked drama only. Firm believer in Maslow's Hierarchy of Needs. Kind of want to start my own cult. Aspiring documentary filmmaker.

Reader insights

Be the first to share your insights about this piece.

How does it work?

Add your insights

Comments

There are no comments for this story

Be the first to respond and start the conversation.

Sign in to comment

    Find us on social media

    Miscellaneous links

    • Explore
    • Contact
    • Privacy Policy
    • Terms of Use
    • Support

    © 2022 Creatd, Inc. All Rights Reserved.