black people and money

What Makes a White Person Support a Black-Owned Business? A White Guy Answers

What Makes a White Person Support a Black-Owned Business? A White Guy Answers

by Dr. Boyce Watkins

Luke Visconti, founder and CEO of Diversity Inc. Magazine, has a column called “Ask the White Guy.”  This appears to be a scenario where Visconti gives the white male perspective on the questions that black people might be afraid to ask.   I find the concept for the column intriguing, and I can’t quite decide if I like the idea of not.

As you can imagine, a column called “Ask the Black Guy” would be problematic to some, since it would take one black person and make him the spokesperson for all of black America (many of us went through this is college).  This is a disastrous strategy that has led to many American corporations losing billions of dollars, like when Mountain Dew released what was dubbed globally to be, “The Most Racist Ad in History” after collaborating with a 22-year old black kid, Tyler the Creator.

But while the column idea is problematic, Visconti should be respected for being honest.  Given that his advice is taken with a grain of salt, we can learn from perspectives that differ from our own.  The question that he answers in a recent column is: What would make white people support a black business over a white business, all things being equal?

Here is some of what he had to say in Diversity Inc:

Answer:

I’ll assume that your question involves a hypothetical company, one which is average, and, therefore, does not have a robust supplier-diversity program. I’ll also make the assumption that the procurement department head and/or CEO is white.

 With all things being equal, and with the above circumstances, there are several reasons for a white businessperson to decide to do business with a black-owned business over a white-owned business (per your question). It’s called “supplier diversity.” Supplier diversity is not charity. It is a process by which companies improve their business. Properly implemented, supplier diversity lowers costs and increases margin and/or revenue.

 

There are several ways this happens:

If you increase the number of suppliers with which you’re doing business, you will lower overall procurement costs.

Women/minority business enterprises (W/MBEs) are forming and growing at a much faster rate than business in general. Aligning your business with a growth sector is a good strategy.

If your company is a consumer company, supplier diversity will help your company brand new consumers (your suppliers and their employees). In the process of doing business, your company will learn the skills necessary to better form relationships with people of color and/or women.

You can read more here: What Would Make White People Support a Black Business? – DiversityInc.

The response given by Visconti appears to present diversity as an important business strategy because a) it gives you a chance to have better products to take to market, b) the government might require it, c) it makes you look better as an organization, d) it can help you become more innovative, e) you can lower costs.  The list is compelling and accurate.

Visconti does make a final point in his piece: “This short list of factors is not inclusive of all the reasons to promote supplier diversity, but it may give cause for you to ponder why supplier diversity isn’t more widespread.”

The reason the practice isn’t more widespread is at least three-fold:  1) Racism:  People still see black businesses as inferior, 2) Whites have a history of shutting us out of economic opportunities, and 3) People typically do business with others in the same ethnic group.  Since whites spent 400 years stealing and hoarding the vast majority of American wealth for themselves (remember, we were slaves for 400 years), they aren’t in a rush to give it back.  So, given that the government doesn’t provide many legal remedies for this form of discrimination, it is likely to persist.

But doing business with white-owned corporations can be a productive part of the black wealth-building process.  Part of the way a country builds its wealth is by obtaining expertise in exporting it’s own production and natural resources.  So, if Black America were a country, we would be building wealth by exporting certain skills, talents or resources (you can think of things we’re known for, such as our singing, labor, or athletic ability) to white Americans.  That’s why the wealthiest black people tend to be those who do business with whites, namely all the entertainers and athletes we know with millions of dollars in the bank.  But of course, this isn’t all we can do, and hopefully, we can one day diversify the list of commodities that we export to white America.

At the same time, we’d be fooling ourselves if we believed that we have open doors to receive opportunities from white organizations and corporations.  Black contractors are always telling me how difficult it is for them to receive opportunities.  So, it might be naive to think that whites are standing around waiting to give us money, because the evidence says that they are not.

I highly recommend taking a look at the article, as long as you remember that this person doesn’t speak for all white people, especially those who are racist.  There are some parts of the economy from which we are excluded, and I’m not sure if this is ever going to change.

Dr. Boyce Watkins is a Finance PhD and the founder of the Your Black World Coalition and author of the book, “Black American Money”. To have Dr. Boyce commentary delivered to your email, please click here.

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