#BlackBizMatters: Spending $1.2 Trillion Black Buying Power With Black Businesses

Buying products and services from black-owned businesses helps them to grow and to employ other African Americans

black businesses
(Image: iStock.com/SusanChiang)

Circulating dollars into black-owned businesses is critical to those businesses–it enables them to keep their doors open. The reinvestment of funds into black businesses presents not only an opportunity for those businesses but also gives them the ability to employ other African Americans.

Algernon Austin, a senior research fellow at the Center for Global Policy Solutions, did an analysis of minority entrepreneurship, finding that “we need to add 1.1 million more businesses owned by people of color to the economy in order to make the racial composition of American business owners match that of the overall American labor force.” According to Austin, these new businesses would add about nine million jobs–enough jobs to achieve full employment for all racial groups. “These jobs would close the black-white unemployment-rate gap and the gaps for Hispanics and American Indians as well.”

Building Black Businesses

The challenge, Austin states, is overcoming the many barriers faced by minority entrepreneurs in growing their businesses, including financing. The purchasing power of African American consumers has reached $1.2 trillion, reports from the University of Georgia’s Selig Center for Economic Growth. Yet, the purported lifespan of a dollar is six hours in the black community compared to 17 days in white communities.

“If we spent nine cents of our collective dollar with black-owned businesses we could employ every single man, woman, and child within the black community,” claims PurchaseBlack.com founder Brian Williams. “So, it only takes one dime to solve the unemployment problem. No marching. Not protesting.  No Al Sharpton. Intentionally spending our money with each other will impact our standard our living.”

A finalist at 2014’s Elevator Pitch Competition at Black Enterprise’s Entrepreneurs Summit, Williams launched Purchase Black L.L.C. in 2013. He began working on the site while obtaining an MBA at the University of Texas. He describes PurchaseBlack.com as a shopping website & mobile app (with more than 10,000 downloads). Williams sells curated products from carefully chosen black-owned businesses nationwide that sell by invitation only. “It’s hard to not only #BuyBlack, but it’s hard to also buy quality and reliable (products and services). We solve all three problems.”

Solving Black Issues

Supporting black-owned businesses is a sustainable way to strengthen the community,  says Williams. Strong black businesses can help solve many black issues, including standard of living and unemployment, “so I made a company that helps us spend with each other,” he explains.

Williams notes that black people spend enough money on goods and services to get black businesses to reach the level of a BE 100s Industrial/Services company– sales revenue generation beyond $10 million. “Yet, we will spend all of our money with major companies that don’t care about our communities” he says, referring to not only employing black workers but doing business with black suppliers.  “We need a collective consciousness among us where our purchases are really an investment into the community’s well-being.”

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  • Orlando coombs

    I believe people of all races should support black owned businesses. All races. Everyone should support black owned businesses and make regular deposits ay black owned banks. Which many are doing right now. But I say this for a number of reasons. 1) Black owned businesses employ more than 1.4 million people of all races across America. 2) Black owned create jobs in parts of our community where there are no jobs. 3) They hire and retain the most downtrodden and marginalized groups of people in our society. Ex Cons, Welfare Moms, teen parents, high school dropouts, former drug addicts, and the long term unemployed. 4) At black owned businesses, everyone gets a chance. 5) They create positive in the black community and our whole society everyday. 6) Black owned businesses circulate over $167 billion dollars (which is an undercount in my opinion), throughout the U.S. economy. 7) Black owned businesses, especially restaurants and (I’m a major foodie), have great food, great service, and are very enthusiastic about serving you and accommodating you because they love you. 8) Black owned businesses and their success on many levels strengthen our economic powerbase and give us leverage. That’s what made the Civil Rights movement and the black power movement so successful. Economic leverage. 9) There is a direct link between a strong black middle class and successful black owned businesses. In fact, it aint happening no other way. 10) Finally Black owned businesses are vital to the global economy. 1.3 Trillion in spending power and an aggregate combined black annual income of over 900 plus billion dollars, 2.2 trillion in economic muscle that if you took black people out of America, Wall Street would collapse in an hour guaranteed. This world aint making it without us.

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