Supporting Black creators has consumed Aurora James for her entire working life. The Toronto-born fashion designer started her sustainable line Brother Vellies in 2013 as a means to employ artisans across Africa and preserve traditional shoe-making techniques. Founded with a mere $3,500, her company grew into a high-fashion favorite, with fans in Beyoncé, Meghan Markle and Serena Williams. But that was never the point.
The mission of representation hit closer to home in the summer of 2020, when a wave of unrest swept the US and masses took to the streets to protest racial inequality in the wake of the unjust killings of George Floyd, Breonna Taylor, Ahmaud Arbery and others. Banks, media conglomerates and big box retailers scrambled to signal their support, but James still believed they could all do more. So she took to Instagram and challenged retailers to make a commitment to devote 15% of their spending to Black-owned businesses. After all, Black people represent 15% of the American population, “and we need to represent 15% of your shelf space”, she explained on social media.
With that, the Fifteen Percent Pledge was born. Sephora, Macy’s and Bloomingdale’s were the first juggernauts to come onboard. With 29 retailers across three countries currently participating, the pledge claims to have directed more than $10bn into some 625 businesses that are at least 51% Black-owned. The organization started to advise small Black-owned companies on business development, as a means to circumvent the structural racism that necessitated groups like the Fifteen Percent Pledge in the first place. “We understand the history and the infrastructure and how Black people have been historically and intentionally excluded from building wealth,” says LaToya Williams-Belfort, executive director of the nonprofit. “What we need from corporations is for them to reverse that.”
According to research from the consulting firm McKinsey, about 15% of white Americans hold some form of business equity, compared with only 5% of Black Americans. The pledge has set a goal for retailers to pour $1.4tn into Black-owned businesses while upping their overall representation in the US marketplace to 14.6% by 2030. Closing the wealth gap redounds to everyone’s benefit since an equitable economy is a healthy economy.
But the journey is far from over. Williams-Belfort reckons that most pledge-takers are currently indexing at about 3% representation on their shelves, and commends them for starting the process. After all, fixing a broken system doesn’t happen overnight. Sephora says it’s reached 15% in the haircare category, while Nordstrom says it added 145 new “Black and Latinx-owned brands” in 2021. Lackadaisical consumer attitudes haven’t exactly helped influence retailers to sprint to the finish line. The urgency to #BuyBlack reached fever pitch during the early days of the lockdown but once that fervor cooled, so did the spending spree.
It’s enough to frustrate Kristian Edwards, a small business owner and #BuyBlack activist since before the pandemic. The Washington DC-based public health professor launched BLK + GRN, her online marketplace for Black-made natural body and beauty products, in 2017. As attention focused around the #BuyBlack movement, and the pledge in particular, “my sales went through the roof” – for a couple months. The numbers at her business are now back where they started. “We created a moment in history, but not a movement,” Edwards says.
Black businesses have what it takes to land customers and keep them. “On average, Black-owned businesses have a higher [Yelp] rating of 4.34, versus the average rating across all businesses of 3.64,” says Tara Lewis, vice-president of community expansion and trends at Yelp – another company that has taken the Fifteen Percent Pledge. Since Yelp doesn’t sell products, per se, the company has come up with its own version of the pledge and has made a concerted effort to promote Black businesses in its listings and support them at company events. “And this [discrepancy in ratings] existed before 2020,” she says. “It shows that Black businesses that are on Yelp are engaging, providing great service.”
But good quality only gets you so far. When it comes to making the jump from retail to wholesale, from mom-and-pop to mass market, Black businesses face especially high hurdles. According to recent data from the US Federal Reserve, Black entrepreneurs are twice as likely to be turned down for loans. Their chances of getting approved for credit cards were likewise dismal. A 2020 government study of the Paycheck Protection Program noted the structural inequalities “built into the administration of the program, the application process and the fee structure”.
It bears noting that no banks or venture capital firms have yet agreed to the Fifteen Percent Pledge. Which means that many Black-owned startups have yet to receive the infusion of investment that it takes to grow from a startup to a brand primed to blow up. According to a McKinsey report, only 4% of Black-owned startups remain in operation after 3.5 years.
“It kind of has to go on two ends,” says Jessica Ramírez, a senior retail research analyst at Jane Hali & Associates who follows retail trends for Wall Street. “You have to have a retailer that will open the doors for these brands, and then [as a brand] you have to have funding in order to create a bigger brand. So the more we can give an opportunity to the diversity in funding, we’ll have more growth with products that we can put on the shelves.”
In many ways, the challenges Black businesses face are more or less the same as they were in 2020. But maybe the end goal isn’t as static as a percentage point. Calling attention to the injustices that blight the American economy has had an unignorable impact. Corporate retailers feel more responsible for their diversity and inclusion practices on their shelves and organizational charts, and Black businesses no longer bury race in their sales pitches. “You’d be surprised at the number of brands started by Black women who were once scared to show their faces on their websites,” says Edwards. “They worried it would pull down their sales if someone saw them.” And now? “They brag about it.”
