How the Pandemic Is Affecting Black-Owned Businesses in Minnesota
In an effort to gather important data about the financial impacts of the coronavirus (COVID-19) pandemic on African American-owned businesses in Minnesota, the African American Leadership Forum (AALF) partnered with the Minnesota Black Chambers of Commerce, Black Women’s Wealth Alliance, Northside Economic Opportunity Network, Social Impact Strategies Group, Metropolitan Economic Development Association, Just Law, LLC., and the West Broadway Area Coalition to develop the Black Business Collective and a Minnesota Black Business COVID-19 Impact Survey.
Eighty-five businesses completed the form and findings from the survey provides more information about what these businesses are experiencing and what they need to cope with the pandemic. Of the businesses surveyed, most were within the 1-5 employee range; 43% had an average monthly revenue of $1000 -$5,000; 20% had an average monthly revenue of $5,000 to $10,000; and 14% had an average monthly revenue of $10,000 to $30,000. The business owners who completed the survey operate primarily in the health & beauty, professional services, healthcare, construction, and food services industries. In addition, the businesses we gathered data from are located across the Twin Cities and Minnesota; with 42% in Minneapolis, 9% in Saint Paul, 6% in Brooklyn Center, 5% in Burnsville, and 32% in undisclosed locations.
The COVID-19 pandemic is having a significant impact on African American-owned business statewide. Sixty-two percent of the businesses surveyed have experienced reductions in their revenue, 40% of Black business owners are struggling to pay their bills, 35% of Black-owned businesses have closed temporarily due to social distancing mandates and closures, and 21% are at risk of closing permanently. In addition, 14% of Black-owned businesses have seen a reduction in staff and 13% are at risk for eviction.
What Black Businesses Need to Survive the Public Health Crisis
Data from the Minnesota Black Business COVID-19 Impact Survey demonstrates that the supports needed by African American-owned businesses is financial, resource-based, and operational. In total, the businesses that completed the survey expressed a need of $600,000 to cope with the financial impacts of COVID-19; the average cost of funding requested is $10,800.
Moreover, the businesses expressed a preference for funding support in the form of forgivable loans, no-fee or no-cost loans and/or grant support. In terms of non-capital needs, the businesses expressed the need for IT, marketing, and sales and strategic problem solving support.
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