Booming Entrepreneurship Among Black Women

    Comments:  | Leave A Comment

    black_woman_entrepreneur_main.jpgCheryl Lofton had never intended to be a small business owner. Her grandfather, J.C. Lofton, was the first African American to own a tailoring school and related business in Washington, D.C. She spent her summers working with him, learning the craft. She was able to earn money while enrolled at Howard University by ironing, mending, and tailoring her classmates’ clothes.

    When her grandfather became ill, she found herself spending more time on the business   – including purchasing a new building – and less time sewing and attending to financial matters.

    “The day I opened the doors to the new building was the day he died,” she recalls. “I was the first college-educated person in my family, and I went so I wouldn’t have to join the family business. But my conscience wouldn’t let me let the business go under. At the time, no one else in the family was interested or able.”

    Today, it’s her name on the doors: Cheryl Lofton & Associates. However accidental, Lofton is part of a national trend.

    Since 1997, the number of African American woman-owned businesses has skyrocketed by more than 250 percent. Today there’s an estimated more than 1.1 million Black woman-owned businesses in existence, with an estimated $44.9 billion in revenue for 2013, according to a report commissioned by American Express OPEN, which analyzed Census data.

    “While firms owned by women of color are smaller than non-minority women-owned businesses both in terms of average employment and revenues, their growth in number and economic clout is generally far outpacing that of all women-owned firms,” the report explains.

    Most of the businesses are one-woman shows: According to the National Women’s Business Council, 96.5 percent of Black woman-owned firms are non-employer status. The small remaining employer businesses owned by Black women provided 272,000 jobs this year.

    New York, Georgia, and Texas are home to the highest number of Black women-owned businesses. In North Carolina, Black women-owned businesses are thriving; since 1997, the number of such businesses has increased by 265 percent, the rate of employment of these businesses is up 358 percent, and revenues generated have boomed 406 percent.

    “Women of color haven’t had as much access to mobility in the corporate world. Even though there’s this sense that diversity is important you just haven’t seen it reflected,” says Farah Ahmad, policy analyst at the Center for American Progress. “There’s this urge for businesswomen of color to start their own businesses and have professional and career success in that way.”

    But entrepreneurship carries its own obstacles for Black women, especially those in male-dominated fields. (For this reason, Lofton makes it a point to do business with other women owners – including her barber, her tailor shop’s plumber, and her home’s landscaper).

    “Qualifying for loans…is much more difficult as an African American. The same credit score that’s okay for other folks is not okay for us,” Lofton explains. She has the additional burden of being a woman, saying her grandfather’s male clients did not take her seriously once she took the reigns. She said, “I’m both female and Black, that’s like a double whammy.”

    Among African American households, 53.3 percent of wives are breadwinners, according to the Center for American Progress.

    Lofton says her childhood home ran similarly – she’s not sure whom the breadwinner was, but her mother held the purse strings and “worked miracles.”

    These trends in women-driven business have not gone unnoticed. The U.S. Small Business Association offers more than 100 centers across all 50 states, Washington, D.C. and American Samoa, where women can get training on starting and growing small businesses.

    “What’s interesting is that the sheer number of businesses has been really large, but the number of employees and revenue has been really low,” Ahmad explains. “It’s the exact type of entrepreneurship the government says drives our economy, and there needs to be a look at investing in these businesses.”

    For Black women who are interested in starting a business, the resources are out there.

    The federal Minority Business Development Agency offers help with everything from expansion tips to loan and grant information. Such organizations also exist at the state level, in most cases. And a Forbes article titled, “Minority Women: Entrepreneurs: Go-Getters Without Resources,” recommends joining women’s associations and trade groups.

    Lofton also has advice for Black women considering going into business for themselves.

    “Be dedicated to what you do, and work hard every day to grow your business,” she says, adding the importance of mutual support among women business-owners. “Women are everywhere now. I think we’ve gotten a lot more respect by stepping out. They know we can do it, and we will do it.”

    Comments

    blog comments powered by Disqus
    Follow

    Get every new post delivered to your Inbox.

    Join 172 other followers