African American Business Owners

According to the US Census Bureau, there are 1 million Black owned businesses in the United States. Black businesses account for over $100 billion in annual sales, and African Americans have over $800 billion in expendable income each year. Minority business enterprises (MBEs) are a rapidly growing and increasingly important segment of the U.S. and global economy.

From 1997-2002, the total number of U.S. companies increased by 2 million. According to the Minority Business Development Agency (MBDA), over 50% of this increase was accounted for by minority-owned firms. MBDA notes that minority-owned businesses are diverse, and participate in a wide variety of industries like financial services, health care, construction, transportation, and other services.

However, despite the impressive growth in the number of U.S. minority firms, MBEs must increase their size, scale, and the economic viability of their firms if they are to compete effectively in the global economy. In this day of the global economy, minority businesses must be assertive and innovative competitors who will not fear or retreat from globalization.

In the MBDA report, “Minority Business Enterprises Mastering the Supply Chain: A Perspective,” research suggests that businesses who understand the supply chain concept will be more equipped to bring their businesses to the next economic level. The report, available at www.mbda.gov, demonstrates how minority businesses are able to grow their companies by coping with the challenges of local, national and international competition.

If minority businesses learn about and master the three levels of supply chain management, new opportunities await their businesses. Supply chain management is defined as the “planning and management of all activities involved in sourcing, procurement, conversion and logistics management activities. It also includes the coordination and collaboration with channel partners, which can be supplies, intermediaries, third-party service providers, and customers.”

The three levels of supply chain discipline according to the MBDA include:

• Managing the fundamentals of supply chain, which includes identifying the risks that exist within the supply chain. Once the risk is identified, the business owner may take steps to mitigate those risks.
• Selling the value of a shorter and more reliable supply chain. By reviewing the supply chain, the business owner can see where efficiencies are needed and where partnerships may be formed to decrease costs yet increase turn-around deliverables.
• Transcending today’s supply chain. By acquiring the skills to get ahead of today’s supply chain trends, moving toward higher value positions and markets and staying ahead of the competition, the business owner will see greater results.

The three levels of supply chain discipline lead to business owners to a path of continues study and learning. Staying abreast of the market and trends happening within the market and with technology will lead to business decisions that are relevant. Minority businesses have great opportunities with their businesses, and taking charge of the business is the first step to success.