According to the Cox Small Business Snapshot, 90% of minority small business owners are hopeful about the growth of their business in the next year. Just over 60% have returned to or exceeded their pre-pandemic financial levels.
“It’s been a tough year on companies worldwide, but particularly among minority-owned businesses,” said Perley McBride, executive vice president of Cox Business. “While we’ve seen movements take root in shopping small, buying local and supporting minority-owned companies, it’s heartening to hear many businesses are recovering and are optimistic about their financial futures.”
That’s not to say that COVID-19 didn’t present hardships for this community. More than 75% of respondents claimed the pandemic heightened their business challenges. Roughly half applied for Paycheck Protection Program (PPP) loans, of which about two-thirds received full funding. Of the 72% of respondents who obtained personal stimulus money, most (81%) invested the funding back into their business.
What are they investing in? Technology. Fifty-eight percent of surveyed owners implemented new tech because of the pandemic – most frequently E-commerce platforms, touchless payments, and contactless delivery services like curbside, delivery and/or buy-online-pick-up-in-store (BOPIS). More than half intend to continue using technology in the same areas over the next year. Other ways surveyed owners plan to strengthen their businesses include:
- Offering additional products and/or services (50%)
- Updating their current location(s) (27%)
- Hiring or re-hiring more employees (26%)
- Expanding to a larger space (25%)
- Adding more locations (24%)
Beyond the pandemic, minority-owned business owners often face unique challenges launching and growing their businesses. Top challenges faced among respondents include growing a customer base, accessing funding/capital, and planning and structuring their business. Over two-thirds (65%) say these issues are unique to minority-owned businesses.
Larger enterprises can help. Fifty-five percent of business owners surveyed would like to see improved supplier diversity, as well as increased minority-specific grants and funding opportunities from bigger enterprises. Just under half (45%) want to have more mentorship or advisory programs with business executives.
“Creating opportunities for minority-owned businesses is something all companies can prioritize, whether at the individual level through mentorship or by financially investing in budding owners,” said McBride. “Cox is making strides in this arena – for example through our Supplier Diversity Program – and aims to continue growing our support of minority-owned businesses.”
About the 2021 Cox Small Business Snapshot
Cox commissioned a survey focused on the challenges of minority-owned businesses. We aimed to catch a glimpse of the issues they face – and more importantly, how they rise above. Respondents to the online survey included a total of 742 business owners. The margin of error for this survey is plus or minus 3 percent.