Los Angeles County has 28,000 Black-owned businesses. Of these, how much of the $875 billion spent by Black consumers do you think was re-invested to strengthen their own communities?
What would be the state of the Black economy, if most of these dollars were recycled within the Black business sector? Did you know that if the annual income of Black America was recycled that only twice within the Black community it would surge Black buying power to more than $2 trillion?
Every April Black Business Month is celebrated to strongly encourage the community to do business within itself to empower Black America and eliminate the Black economic crisis, which a mission of the Los Angeles-based nonprofit community empowerment group Recycling Black Dollars (RBD).
In April 1996, Black Business Month began here in Los Angeles as a local campaign promoted by RBD’s late founder, Muhammad A. Nasserdeen. Nasserdeen urged Black consumers to support Black-owned businesses in Los Angeles County, particularly during the month of April by focusing collectively on recycling earnings within the community.
Refusing to recycle the dollar is a choice that continues to quietly sabotage the improvement of the Black community, its economic power and future.
Black Americans spend more for consumer products than any other ethnic group; hence, the reason non-Black ethnic groups start businesses and ultimately succeed in the Black community.
These non-Black business owners know they will find loyalty, fewer competitors, if any, and a steady source of revenue from Black consumers. Although the Black community has less discretionary income to fund long-term investments, own fewer homes, as well as businesses, and have the least amount saved in retirement accounts, the Black community manages to spend more with other ethnic groups than their own.
“The problem with African Americans is that they respect and recognize other ethnic groups when in turn, those ethnic groups support their own,” explains Los Angeles Black Business Association President Earl “Skip” Cooper.
“The major collector of revenues and incomes in the African American community is the Black church. With such an influence, the Black church should be a major financial pillar and supporter of Black entrepreneurship and economic development, yet they go unchallenged.”
Many Black Americans who refuse to buy at Black businesses claim prices are too high, the service is inferior, or the products are below par.
However, the only way Black American businesses can improve is if they attract more consumers. The only way to provide more jobs for the community is if they patronize local businesses. The wealth of a community depends upon how many times money circulates or recycles within the community.
The Harvest Institute, a Washington, D.C-based research group, surveyed how many times income circulates within a community before leaving and has found that in the Black community, income circulates zero to one time. In the White community, income circulates unlimited times, in the Jewish community, income circulates at least 12 times; Asians recycle at least nine times, and Latinos recycle their dollars at least six times.
The formula for recycling community dollars has seemingly been mastered in every ethnic community except the Black community. Other ethnic groups set up their community and encourage recycling through various means of communication such as signs, billboards, cultural symbols or language just as the Black community does. Secondly, they set up small businesses to serve each other, just as the Black community does. Thirdly, they spend with each other first before spending with other ethnic groups. This is where the differences lies.
Founded in 1988, RBD’s overall mission is to aid in the economic development of the Black American community by teaming with consumers, organizations, churches and Fortune 500 corporations to foster consumer purchasing, vending and contract opportunities. RBD collaborates with local and national banks as well as other funding organizations to provide capital for the development and expansion of the Black business community.
America’s largest Black bank, OneUnited Bank, is an RBD corporate sponsor and encourages Black consumers to bank with Black-owned funding institutions.
“In the past 10 years, we have financed over $1 billion in loans, including churches, affordable housing, office buildings and retail stores, most in low to moderate income communities such as South Central and Compton,” says Kevin Cohee, OneUnited chairman and CEO.
Other services include assistance with business plans, marketing, accounting, advertising, promotions, and resources. Mentoring, training seminars and educational programs, such as “How to Start and Operate a Business in the 21st Century,” “Learn to Prepare Income Taxes,” “Writing a Successful Business Plan” and “Getting Financial Aid for College” are just a few resources that RBD offers. The organization also publishes a monthly electronic newsletter named aptly “The Black Dollar.” “The Black Business Directory,” a community phone book published by the organization, creates a useful network for local Black businesses to recycle their dollars with each other.
To learn more about unleashing the wealth in your community visit www.rbdmedia.net.
