Courage, Key Resources Yield Optimism Among Minority Business Owners
Marshalynn Odneal, national sales executive for minority business, dives into PNC’s latest Economic Outlook survey of minority business owners.
By Marshalynn Odneal
During the first three months of the pandemic, 41% of black-owned businesses and 32% of Hispanic-owned businesses closed across the country. By contrast, only 17% of white-owned businesses shut their doors, according to a study by the Federal Reserve Bank of New York. Despite this reality and even as minority business owners face current economic challenges, including supply chain disruptions and inflation, results from PNC’s recent Economic Outlook survey show an impressive resiliency and positive mindset among these business leaders.
According to the survey, more than two-thirds (68%) of minority business owners feel highly optimistic about the prospects of their own company in the next six months, compared to just 60% of non-minority-owned businesses. And while both business owner groups remain cautious about the national economy, the gap between optimism among minority business owners for their own company versus the broader U.S. economy is 40 percentage points, significantly higher than 31-point difference among non-minority owners.
I have no doubt that minority business owners who were able to manage the world health crisis had to make unprecedented decisions related to staffing, business models and pricing. In doing so, they faced a Goliath – and won. It’s unsurprising that their mindset about the future of their businesses, despite current economic challenges, is optimistic.
All of this is just the tip of the iceberg. According to our survey, 65% of black- and Hispanic-owned business owners stated they have a business plan suited to the current direction of the economy, significantly more than non-minority owned businesses (55%). This highlights the importance of access to crucial resources for these business owners. The survey reinforces this point, showing that 86% of black- and Hispanic-owned businesses interacted with or leveraged resources from the Small Business Association (SBA), a local chamber of commerce or a community economic development organization. Only 69% of non-minority business owners reported doing the same.
The truth is that the unique financial challenges minority-owned businesses have long faced were amplified during the pandemic. As a result, more minority business owners are now seeking Minority Business Enterprise (MBE) certification, which is also an important and needed resource.
Businesses that become MBE certified, gain exclusive access to premium networking events, affordable consulting services, and technology programs, among other benefits, according to the National Minority Supplier Development Council. Our survey revealed that nearly nine out of 10 (87%) black-owned businesses are now MBE-certified, up from seven out of 10 (69%) last year. Three-quarters (75%) of Hispanic-owned business are MBE-certified, compared to two-thirds (67%) last year. Of MBE-certified businesses, a majority of black- (80%) and Hispanic-owned (84%) businesses said that certification has been a helpful business development tool.
PNC has taken significant steps in doing more for minority-owned businesses and providing necessary resources to help them overcome roadblocks. As a part of our Small Business organization, PNC’s Minority Business Development (MBD) Group’s mission is to deliver solutions and resources that foster financial wellness for small businesses within our diverse communities. We’ve been able to do this, in part, through our PNC-Certified Minority Business Advocate initiative, a voluntary advocacy program that helps PNC employees understand the challenges facing minority-owned businesses and how to guide minority entrepreneurs to the appropriate resource.
Optimism among these business owners, combined with access to financial, educational, and other useful resources, can position these entrepreneurs for scale and growth in the long-term.
If their optimism is realized and the U.S. business landscape prospers further down the road, minority business supporters must continue to execute against their mission and accelerate their efforts. The outlook is bright, but we must continue to do our part to advocate for these entrepreneurs and help their communities thrive.