As protests erupted across the country in the weeks and months following the United States’ 2020 racial reckoning, Black-owned businesses received a historic outpouring of support.
Rochelle Porter, the owner of the decor and activewear brand Rochelle Porter Design, saw her sales and follower count skyrocket. Porter began selling masks at the start of the COVID-19 pandemic, and as people were quarantined, they outfitted their homes with her vibrant textiles. Then, as social-justice issues took center stage, press coverage sparked a flood of sales.
However, as the pandemic progressed, much of the consumer enthusiasm faded. “We’ve definitely seen a leveling off since then,” Porter, who is currently in Atlanta, said.
The United States is experiencing a surge in entrepreneurship, with women of color representing the fastest-growing segment of new business owners. However, according to a new Meta report, businesses run by underrepresented founders were 14 percent more likely to report lower sales than other businesses last year. Meta’s global state of small business report, which surveyed 5,324 small-business leaders in the US (and more than 24,000 globally), cited the same disparity in its findings from the previous year, which were released in June.
Underrepresented business owners have had a more difficult time recovering from pandemic-related setbacks, according to Nicola Mendelsohn, vice president of Meta’s global business group.
When the report was broken down further, it discovered that 51 percent of Black-owned businesses were experiencing record-low sales compared to January 2021, compared to 36 percent of all US businesses. Black-owned businesses were also the most likely to have closed in the previous year.
As a result of the pandemic, black-owned businesses have faced additional challenges, such as reduced employment,” Mendelsohn said. “They’ve also cited cash-flow issues and a lack of demand as contributing factors to lower sales.”
While slower months in retail, particularly January and February, are to be expected, Porter believes media coverage and social-media traffic will peak as early as the first quarter of 2021.
She noticed a decrease in engagement on Instagram and Facebook this year as algorithm changes made it more difficult to reach customers.
“It’s really difficult to keep up with the algorithm,” Porter admitted. “A post that would have received 200 likes last year or the year before now only receives a fraction of that.”
Meta has initiatives to provide underrepresented founders with education, funding, and business tools, such as its Elevate program, which trains and mentors Black and Latino business owners in digital marketing strategies.
