Summer support for Black-owned businesses faces holiday test

Black-owned businesses that saw a boost in consumer purchases following this summer’s nationwide protests over racial injustice will soon see if those gains extend through the crucial holiday shopping season and into 2021.

Support for minority-owned establishments increased amid the demonstrations sparked by the May 25 killing of George Floyd by Minneapolis police. The unexpected revenue increase also helped owners whose businesses were struggling more than their white counterparts during the pandemic.

Small-business owners who spoke with The Hill said Blackout Tuesday on June 2, when Black Lives Matter supporters encouraged people to stay silent on social media to draw attention to racial injustice, in many ways marked the beginning of noticeable sales increases.

“After Blackout Tuesday, our revenue did boost by about 100 percent from people really tagging us on social media, supporting us and telling their followers to purchase from Black-owned businesses like ours and why they thought our brand was really important,” said Erin Carpenter, founder and chief executive officer of Nude Barre, an online store that offers undergarments in varying skin tones.

Carpenter said that from there, she saw activists realize that “this needs to be more than just a day” and then ask “what else can we do to kind of transition the wealth gap in the world?”

“Supporting Black-owned businesses could be a way to go about that,” she said. “So people that had large followings and a lot of influence, whether it was celebrities or influencers that had a million followers or whatever, started tagging brands and sharing brands they felt that people should go out and support or follow or check out.”

Kam and Summer Johnson, founders of Zach & Zoë’s Sweet Bee Farm, said they saw a “significant spike in late May, early June” in sales once the protests gained traction.

“I think shortly thereafter there’s just a lot of really organic rallying around, supporting people of color,” said Kam Johnson, whose farm sells raw, unfiltered honey at Chelsea Market in New York City but has since moved to mostly online sales.

Summer Johnson said she welcomed efforts to focus on Black-owned businesses, noting that many of them have been overlooked amid the competition.

“I appreciate that people are looking towards Black businesses, because for so long they were looking away, and I think that we tried to appeal to everyone,” she said.

However, she emphasized that she and her husband want their success to stem from the quality of their product, not the color of their skin.

“We’re just a company that has always had the attention of everyone, not just because we were Black-owned,” she said, noting their business was established in 2015. “But now that people are starting to buy Black-owned, we’re not going to turn it down, but at the same time, we’ve never needed it.”

Support for Black-owned businesses was not consistent across the board, in large part because of the devastating effects of the pandemic by early June, said Tiffany Howard, an associate professor of political science at the University of Nevada, Las Vegas.

Store location also played a big role, Howard said.

“If it’s going to be located in a neighborhood that’s predominantly African American or inner city or lower-income, it may be hurting a little bit more just because of what’s happening economically to their consumers,” she said.

“Whereas, if it’s an online-based business or in a wealthier neighborhood or more economically stable neighborhood, then the sentiment around supporting Black-owned businesses may be leading to higher revenue.”

An analysis by the Federal Reserve Bank of New York found that between February and April there was an estimated 41 percent decline in Black-owned businesses and an overall “disturbing relationship between high geographic incidence of COVID-19 and the economic health of Black-owned businesses.’’

More recent data from Survey Monkey published by CNBC found that only 47 percent of Black small-business owners have remained open during the pandemic, compared with the overall average of 58 percent.

Howard pointed out that Black-owned businesses with a physical presence in lower-income areas or communities of color may be more severely affected financially because those communities are also disproportionately impacted by the coronavirus.

“Definitely the pandemic, at an economic level, has hurt Black-owned businesses and we also see that in the health disparities, as far as African Americans and Latino Americans being the ones who have a higher mortality rate for COVID,” she said.

Centers for Disease Control and Prevention data show that African Americans are infected at 1.4 times the rate of white Americans and have died at 2.8 times the rate of their white counterparts.

Black-owned businesses that were able to pivot to online sales have found more success, including a boost from the summer’s nationwide protests.

The focus on economically oriented goals by Black Lives Matter activists is significant, Howard said, and could have long-lasting impacts on the future of Black entrepreneurship.

“To be honest, in my recent memory, I’ve never seen anything like this,” she said.

“I’ve personally never seen this type of spotlight on Black-owned businesses and I think it’s wonderful of course, and I hope that it’s a sustained long-term impact that leads to a greater closing of the wealth gap and greater economic mobility for African American entrepreneurs.”

Carpenter, of Nude Barre, said the prospects for long-term success will face their biggest test this holiday season.

“I would say the momentum has kind of been continuing because even as we go into the holiday season, and even though the time period right after Blackout Tuesday was in the summertime, people are even still considering, ‘Oh, for holidays we should also continue to support Black-owned businesses.’ ”