It’s more important than ever to support Black-owned businesses. A new report claims the coronavirus pandemic and the federal government’s national response could permanently impact and force small businesses to shut down before 2021.
Black-Owned Businesses In Danger
According to a new report, nearly half of Black companies will run out of money in the coming weeks. Ultimately, more legislative support is needed to help businesses survive in an economy still adjusting to completely shutting down in March because of the COVID-19 impact.
Small businesses have largely exhausted their federal funding and are starting to lay off workers, with many worrying about having to shut their doors for good, according to a new survey from Goldman Sachs provided exclusively to Axios. Business still has not returned to normal, six months after the coronavirus pandemic first appeared in U.S. But small firms say the money they received from the Paycheck Protection Program has run dry. Data show Black-owned businesses face an even steeper climb. 43% say they their business’s cash reserves will be depleted by year end if Congress does not act in September, compared to 30% of respondents overall. 31% say less than a quarter of their pre-COVID revenue has returned. (Axios)
Small Business Loans Hurting
According to reports, August loans for small businesses took a slight hit. Approval rates slowed down and sent a reminder to why legislative support is needed more than ever for companies to survive until at least a COVID-19 vaccine is made available.
Small business loan approval rates at banks fell in August 2020. Figures from the Biz2Credit Small Business Lending Index show a small drop in such approvals in August. The data indicates that the rising number of small businesses acquiring loans from May onwards has plateaued. In August 2020, big banks, with $10 billion-plus in assets, granted just 13.6% of the loan applications they received. This compares to 13.8% in July. A similar dip can be found in the number of small banks approving loans. In August, 18.5% of small banks approved funding requests. This was marginally down from an 18.6% approval rate in July. (Small Biz Trends)
Hip-Hop Supports Black-Owned
Over the past few months, various high-profile celebrities have shared support for Black-owned operations. Everyone from West Coast rapper YG and Chicago’s Dreezy to models like Lori Harvey have encouraged people to support Black.
“4HUNNID POP UP, JULY 2020 – Proceeds will be going towards supporting black owned businesses that were effected during these times ❤️❤️❤️❤️ – @4hunnid” -YG’s Instagram
“Tag your business and tell me what you do. I’ll be online shopping all day today! ❤️ BLACK EXCELLENCE 🙏🏾” -Dreezy’s Instagram
“Tag your favorite Black Owned Business to be featured in my new Video! VERY SIMPLE GO TO www.Missingyou1111.com WRITE A FEW DETAILS ABOUT YOUR PRODUCT ALONG WITH YOUR INFO AND THAT GOES DIRECTLY TO MY COMPANY EMAIL! WE WILL BE GOING THRU ALL EMAILS STARTING AT 10AM TOMORROW!!! #Missingyou11:11 July 15th NYC ❤️” -Ashanti’s Instagram
“Tried out @ancientcosmetics body oil.. it smells great & had my skin soft and glowing #BlackOwned #SupportBlackBusinesses 🍯” -Lori Harvey’s Instagram
In June 2020, model and “Claws” actress Karrueche Tran helped local Los Angeles residents locate Black-owned coffee shops.
“#BLACKLIVESMATTER #SUPPORTBLACKBUSINESS #LOSANGELES” -Karrueche Tran’s Instagram