Alabama’s Hidden History: Black entrepreneurs face barriers in business

Black-owned businesses like King’s Kitchen on Hargrove Road in Tuscaloosa can be the heart and soul of any community, so it’s hard to imagine businesses like it have a hard time getting started and saying open.

“Finding good help is the key thing and that’s still a problem today,” said King’s Kitchen owner Otis King. “So if we weren’t consistent in what we are doing, we probably would be out of business.”

That’s one of the reasons why the University of Alabama is conducting a five-year study surrounding the state of Black-owned businesses, said UA Professor of Entrepreneurship and Strategic Management Lou Marino.

“Our research shows that Black-owned businesses tend to fail faster than white-owned businesses do,” Marino said. “And they don’t employ as many people as white-owned businesses do. So if we increase the survival rate of Black-owned businesses and help them grow to the same levels as white businesses, the economic impact in the state of Alabama is at least in the hundreds of millions of dollars.”

Marino is working with students from UA and Stillman College, with support from the Alabama Power Foundation they’ll gather data and conduct interviews with Black business owners across the state.

“Black-owned businesses are seeing higher failure rates through the state,” said Danielle Kimbrough with the Alabama Power Foundation. “We really want to understand why that’s happening. We want to understand the challenges they are facing and take a look at how we can create more equitable opportunities for them.”

They’ll be looking at factors that encourage or impede the growth and survival of these businesses alongside potential supply or demand issues in the markets they’re operating within.

“If you are in a rural Alabama county and you don’t have high-speed internet access, does that stop your ability to have an online business?” Marino said. “One would think that.”

One way to help is getting these business owners talking through the Chamber of Commerce of West Alabama.

“Businesses have to connect to grow,” said Chamber Diverse Business Council Member Mildred Black. “Being a part of the Diverse Business Council means being at the forefront of changes and strategies that we are using to magnify and grow diverse business.”

About 80% of Black-owned businesses fail within their first two years of operation. King said he thanks God every day that his business beat the odds.

“I give it all to Him,” he said. “And also my customers who are very supportive.”

Getting customers to come back isn’t a problem at Wrap it Up Catering, either.

Simone White and her family are the owners of the mobile food truck.

“Our motto is one taste and it’s a wrap,” White said. “We do Jamaican cuisine, but our flagship product is deep-fried wraps, which not many people do. And it’s really unique.”

The family faced several challenges opening their business, especially during a pandemic, she said.

“We are not an open-door facility, so that is one of the difficulties,” White said. “And we had to do a lot of advertising. We were not able to go out anymore and market the product as a result of the pandemic.”

Marino said once they fully examine the challenges these businesses face, finding solutions will be the next step.

“If we can impact the Black-owned business ecosystem in Alabama, it helps every business in Alabama,” Marino said. “Because we are all one community working together, and the better all of us do the better the entire state does. That is what we are trying to accomplish.”

Results from the first phase of the study will be available soon.

For more information on the study, click right here.