After the recession the black business boom Business

The ribs and whiskey bar that Terry Evans opened in the South Loop of Chicago with her 401 (k) savings attracted mostly tourists and convention attendees – until a coronavirus pandemic and orders to stay home swept the country from March 2020. Evans worried about keeping her 12 full-time employees on payroll.

“When it got dark, it got dark,” said Evans, 47.

She decided to start a new business to deliver food and spirits to the urban community by boat, located among 10 harbors of Chicago on Lake Michigan.

In the first months of the pandemic, small businesses owned by blacks closed twice as fast as other businesses, 41% stopped, according to the April 2020 census. Focused on retail, restaurants and other services, businesses owned by blacks found it harder to turn around due to pandemic constraints. They worked with lower incomes, had no relationship with banks and were excluded from the federal small business assistance program.

Then ownership of the black business resumed, soaring higher than it was before the pandemic, according to an analysis by the Bureau of Labor Statistics of the Washington Post. In 2021, small businesses owned by blacks were set up at the fastest pace in 26 years.

Evans Restaurant, Windy City Ribs & Whiskey, is two miles from the water and 6,000 of the city’s boats. She launched Dockside Delivery on her restaurant’s website in May 2020 in hopes of serving this new clientele.

“I will focus on this audience, which still has money, which is still hanging out in the midst of this pandemic,” she said.

It started in the nearby harbor, which is loved by adults, mostly white boatmen. At first they were not friendly. “They said, ‘Why are you in my harbor trying to sell me grocery bags?’ she said.

Her business unfolded later that summer when she focused on the black boat community, especially young women charter owners. “They were going to figure out how to get me to win,” Evans said. “I realized I always had to start in my community.”

She has led other heavy restaurants owned by women and blacks, offering menu options from cajun to organic salads and sandwiches. Her task force picked up orders and made deliveries. Her liquor license – and the relaxation of alcohol laws that allowed the delivery of alcohol – made the business profitable. She was able to retain her full staff even if she stopped serving lunch at the restaurant.

It is now aiming to expand Dockside Delivery by 2023 to other cities with larger boat communities, such as Miami. First, it needs capital and technological resources to build the application. But her parents always warned her against debt.

“The only way to scale is to use the money to scale,” Evans said. “Otherwise you will remain a small business. It’s a minimal thought that you can’t put enough on yourself to go out and get a loan.”

After a successful turnaround at the start of the pandemic, some black-owned businesses now face economic problems of labor shortages, supply chain delays and inflation.

Tyrone Foster, owner of a landscaping company with 20 employees in Portland, Oregon, expected his residential clientele to dry up during the pandemic recession. It has been certified as a minority-owned business in hopes of contracting commercial and public works with more stable budgets.

His company Precision Landscape Services in October 2020 was awarded a two-year contract to maintain the city’s 10-kilometer transportation network, which accounts for about 10% of its business.

To his surprise, the demand for outdoor housing increased when families stayed at home.

“People were saying,‘ Okay, I’m not going anywhere. I don’t want to just stay inside and have a messy mess in my yard. I’m going to turn it into some kind of oasis that I could enjoy during a pandemic, “said Foster, 51.

His company ended 2020 with record revenue. But the noise on home improvement services amid the hot real estate market soon outpaced his abilities. Not having enough employees, Foster turned down 50% of potential customers.

“I was sick of it,” he said. “I could literally double the size of the business if I could hire people. I couldn’t find anyone. “

He offered a $ 1,000 subscription bonus, which he increased to $ 1,500 without receiving any contenders. He offered employees a $ 1,500 bonus for a referral bonus for each new employee. With no favorites, he pooled bonuses and announced a raffle for those who worked three months in the summer to win $ 10,000 in September.

“Goose eggs! Nothing! It still didn’t move people,” Foster said. “At that moment, I gave up. There was nothing else I could do. “

He said some people did not want to endanger their health by working, even after he started paying working kilometers to have them follow the company’s truck in their own cars so that there was no more than one person in the car. Others told him they could do without federal incentive checks. And he faced competition from other companies, such as Amazon, which aggressively hired the warehouse, and Taco Bell, which offered managers $ 100,000 a year. (Amazon founder Jeff Bezos owns The Washington Post.)

Wages, gas, food and supplies also rose. Equipment, spare parts, even factories have become harder to find.

And he expects that the demand for landscaping will grow as people start spending their time – and budget – on travel, restaurants and other activities. He said families who dropped $ 20,000 to $ 100,000 on the yard conversion would not need large-scale work for at least another five years.

Foster said his profit in 2021 fell by more than 2%. However, in March, he bought another landscape company across the river in Vancouver, Washington, attracting 15 employees.

In New York, Tameka Rochester was about to expand her Harlem Cycle spin studio when a pandemic forced her to close its doors.

To keep the business afloat, Rochester rented out their studio bikes and delivered them home to clients. That income covered her monthly rent of $ 3,750. Her teachers earned an income by teaching classes live through Zoom. She has created an on-demand platform with more than 250 videos of workouts from cycling to cardio, strength and recovery, and cooking demonstrations.

Rochester, a former mechanical engineer, and her boyfriend opened the studio in 2016, justified by savings after she was repeatedly denied loans despite excellent credit and a six-figure salary.

Without a relationship with traditional banks, Rochester said, she found herself at a disadvantage when it came to securing state aid from the pandemic through a payroll protection program. Eventually, another small business owned by Black linked her to an accountant who helped her get the money. She has also received grants from corporations and foundations to rescue minority-owned businesses.

“The racial settlement of corporations took only a year and a half,” said the 40-year-old Rochester. “These grants of $ 5,000 to $ 10,000 helped create a buffer, but it wouldn’t take us to a whole different level.”

Her studio reopened 15 months later.

And with an interest-free loan from a mutual fund and two other loans from an economic development corporation and public lender, Rochester was finally able to launch its second studio in Harlem in April.

Reggae and juice are played in the classes. The smell of peppermint penetrates the air. To make up for the shortage of instructors, some of whom left the state during the pandemic, one of her instructors began training clients for training.

“I felt like I was setting up a business four times during the pandemic,” she said.