Why Do So Many Black Businesses Fail?
Have you ever wondered why so many black businesses fail? Many have an opinion, and one of twelve listed by HBCU Buzz caught my attention: No Experience. There’s nothing wrong with trying something new, but don’t go in blind, because you’re sure to come out on the losing end.
Lack of resources, bad customer service, and no professionalism. The list is long as to reasons why black businesses are said to fail. Lack of planning is very big on the list.
Hattie Nelson, director of operations at Nelson, Inc., a local general contracting firm founded in 1972, says young African-American entrepreneurs need to be focused and have a plan (source).
“If they’re not willing to commit everything, don’t do it,” she says. “And they need to have a clear, realistic plan.”
Lack of support is also big on the list.
Gary Rowe, owner of the Memphi Business Development Corp., says blacks should do more to support each other.
“We should have a market that is committed to our success,” he says. “For example, most of the shoppers in Whitehaven, which, by the way, is one of the richest black communities in the state, do not shop in Southland Mall. They go to Wolfchase or somewhere else. The stores in the mall don’t meet their need and when the stores were there, they weren’t shopping there.”
Rowe agrees with Nelson, saying poor planning leads to many failures.
“80% or 90% of the time we change their initial business dream because they don’t have a talent in that area or a realistic plan,” he says. “You have to do a business where your gifts are.”
As mentioned earlier, the list is long as to why many believe black businesses don’t last. What are your thoughts? Why do you think so many black businesses fail at such a high rate?