Black-owned businesses struggle to access funds during pandemic
According to a UC Santa Cruz report, from February to April 2020, the number of active black-owned businesses decreased by 41%, more than double the rate of white-owned businesses.
“Access to capital has been a historically disparate situation for black-owned small businesses,” said Kevin Dick, president and CEO of the Carolina Small Business Development Fund.
This week, the organization is hosting Black Entrepreneurship Week, sharing tips and advice for business owners across the state.
“(We) are trying to provide black-owned small businesses with access to capital information related to secure contracts with public and private sector entities how to pivot in the face of the pandemic,” Dick said.
The Carolina Small Business Development Fund has provided financial assistance to approximately 1,100 businesses since the start of the pandemic.
“Because of the criteria put in place for the programs, they tended to offset some of the typical disparities that black-owned businesses and other businesses of color face. So we’ve had some success with more local programs through grants and loans. , says Dick.
While business owners are hoping that lowering COVID-19 measures and increasing vaccinations will help bring customers back, many have already had to make significant adjustments.
“You have to be aggressive and say, what can I do to help my business survive,” said Alison Kim Perry, owner of Cute Buttons Gift & Paper Boutique.
After operating as a physical location in the Triangle for over a dozen years, Perry underwent a major change at the end of 2020.
“I went from a full brick and mortar service with employees to a custom studio in Raleigh,” said Perry.
Its sales were down 46% last year, but online traffic helped make up for the backlog of in-store business.
“You have to be nimble, you have to save money, you have to find ways to be creative. And if you don’t, you’re going to be in trouble,” Perry explained.
She received an economic disaster loan, but chose not to apply for a PPP loan because she did not want to incur additional debt.
Throughout the pandemic, she has found support from other black business owners.
“You have to create more networks. You have to create a circle of more supportive people and everyone in the same boat and find out how to work together,” Perry said.
Even for businesses that have received grants or loans, Perry urges homeowners to increase their knowledge.
“It doesn’t matter how much money you get from the federal government or anyone else, if you don’t know your numbers and how to make sure your P and L statements are up to par, and if you’re very nimble about saving, this stuff can hurt you, ”Perry explained.
Perry understands the financial hardships many buyers can face and offers people ways to support small businesses even if they can’t spend the money.
“Share posts on social media, refer a friend, tell people about it, write a good review on Yelp or whatever. Just talk about it,” said Perry, who suggested to uncomfortable people. or unable to shop in person to look to see if they can buy any products online.
Dick believes consumers don’t always provide fair opportunities for black-owned businesses.
“Even within the black community, there is somehow less patience if there’s a bad customer experience or if something happens that doesn’t quite meet a customer’s expectations in a business. black owned business. This business may have a chance (to make an impression). While it is a majority owned business, there will be more willingness to try that business again. So I think the stigma must be removed. But there must also be intentionality in finding these businesses (black-owned businesses), ”says Dick.
Black Entrepreneurship Week runs until Friday. If you want to register, click on here.
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