Black women are one of the fastest growing entrepreneurial segments. There are many reasons for this trend: Educated women in general, especially black women, start their own businesses as a result of an unsatisfying experience in the corporate environment. Another reason hits closer to home, with the need to have more career flexibility to benefit family situations. Regardless of the motivations, black women are opening more businesses in recent years, according to a recent survey done by the Center for Women's Business Research. The majority of these new ventures are in the service sector.
Food and Beverage
Fulfilling an unmet demand in the food and beverage sector is a common reason for starting a food-based business. Whether it is opening a restaurant serving cuisine researched on a past trip, or a start-up company bottling and selling a family secret-- a new food business can be lucrative. The core business in this start-up is the product, so development of the special ingredient or perfecting the menu is imperative. Once the product is ready to market, the next step is distribution. Direct distribution, through either a storefront or website is the easiest way to control the product’s marketing. But, selling the product through a retail outlet might allow for more exposure and sales.
Though selling cosmetics in parties is a well-advertised way of making extra cash, there are other franchises that can be just as lucrative, and yet not as capital intensive as a retail outlet. For example, operating an on-site children's fitness program, distributing a home décor magazine, or providing business services, are all franchises that can be run from home. A franchise's advantage is that the marketing and branding is already developed, which means there is already brand awareness to potential customers. The only thing that remains is paying the fee to buy into the franchise and finding a local market to peddle the product or service.
Black women with a special set of professional skills—such as financial forecasting and management information systems—can translate them into teaching. Providing training services is a way to use their industry experience; and it can be done with very little start-up capital. After the initial legal set-up (i.e. sole-proprietorship, partnership, or corporation), new business owners can rent commercial space on an as-needed basis to conduct short-term courses. Additionally, entrepreneurs can provide on-site training services, visit individual companies, and lecture on needed skills. An example of this is in the business technology field, where training can be provided on the latest and most efficient project management software.
With the rise of social media and Internet magazines, there have been many black women entrepreneurs looking to connect and engage an audience. Sometimes these web-based businesses are non-profit enterprises with a social goal, to either inform or provide resources to a new network of Internet-savvy people. For-profit companies, banking on advertising as their primary source of income, use membership to entice companies to promote products on their site. Additional revenue can be seen through like-minded corporate sponsors, looking to tie their corporate brand to an emerging business that is in touch with their target audience.
Consultants positioning themselves by providing businesses with a specialized service, like graphic design, project management, or human resource management, can carve a niche for themselves as a specialized entrepreneur. This is attractive to black women, who have a certain level of management experience, looking to work with large companies, but seeking to retain a level of flexibility. Start-up cost can be minimal, because it can be initiated as a part-time, home-based enterprise. And, there is a high potential for growth. Black women specializing in the health care and childcare sectors can also translate their services into consulting, targeting individuals or government agencies, rather than corporations.
- The Washington Post: Growth of Minority Women-Owned Firms Outpaces All Others
- MercuryNews.com: Cassidy: A wave of women entrepreneurs may be coming
- USA Today: African-American Women Step up in Business World
- Center for Women’s Business Research: Businesses Owned by African American Women in the United States, 2006
- Entrepreneur Magazine: 2010 Home-based Franchises
- black woman on cell phone image by Susan Rae Tannenbaum from Fotolia.com