Born from the collaboration of Amazon’s Black Employee Network and a coalition of strategic partners, the Black Business Accelerator (BBA) wants to build equity and sustainable growth for Black-owned businesses. Specifically, the initiative targets barriers to access such as access to capital, mentorship, and growth opportunities. The BBA will provide financial support, business education and mentorship, and marketing and promotion of their brands and products as third-party sellers on Amazon.com.
Amazon has formed strategic partnerships with the Minority Business Development Agency and U.S. Black Chambers Inc. These organizations will support BBA by leading community engagement and helping provide participants with mentorship, business development, training and educational resources to lead them to success. Thanks to their long-term experience in supporting Black businesses, they will be able to provide council to Amazon on developing BBA further, including expanding it to other underrepresented groups.
Covid-19 disproportionately impacted People of Color, both from a health and financial perspective. A report published in August 2020 by the Federal Reserve Bank of New York showed that the number of active business owners fell nationally by 22% from February to April 2020. Black businesses experienced the highest decline, with a 41% drop compared to the 17% drop recorded by white business owners. The report digs into several data points to try and understand the root causes of such decline. They look at Covid-19 infection rates, business locations, Paycheck Protection Program (PPP) data, and data on small firms’ financial health from the Federal Reserve’s Small Business Credit Survey. They found a high correlation between locations with high infection rates and the high presence of Black businesses. A low number of companies (15% – 20%) received PPP loans in areas where Black businesses were mostly concentrated. Finally, most Black-owned businesses lacked strong bank relationships, which meant that they most likely entered the pandemic in a weaker financial position than white-owned businesses.
In February 2021, an H&R Block survey of almost 3,000 small businesses found that 53% of Black business owners saw their revenue drop by half, compared to 37% of White owners, since the pandemic started. Black business owners also had more trouble establishing an online presence for their company and were more likely to have customers submit late payments, the survey found.
As we get closer to Prime Day, announced for June 21 and 22, Amazon reminds us that more than 60% of product sales recorded on Amazon.com in 2020 came from small and medium businesses. Amazon is committed to growing the number of Black owned businesses that belong to that pool.
Click here to read more.
SOURCE: Forbes, Carolina Milanesi