The onset of the COVID-19 pandemic had a devastating effect on the majority of businesses in the UK. We wondered whether the pandemic had specific, exclusive consequences for businesses in the BAME sector. Researchers at Staffordshire Business School are particularly interested in this subject, and have recently secured funding to investigate the specific challenges that BAME business owners faced during COVID-19, as well as the strategies they employed to combat the effects of the pandemic.
A number of key observations have led researchers to believe that BAME-owned businesses faced a unique set of challenges during COVID-19. For example, BBC reported that in the UK, the mortality rate among people belonging to ethnic minorities during COVID-19 was greater than that among white ethnic groups. Research suggests that due to this overwhelming disparity, BAME business owners lost more customers and employees to the pandemic and that this loss posed a greater threat to their businesses when compared to white-run ventures. We cannot ignore the impact that loss of life had on BAME-owned businesses, but we were also interested in getting practical examples from black entrepreneurs on the nature of their biggest challenges during this worldwide period of economic instability.
We spoke to Gambian-born entrepreneur and business owner, Eliza Jones, who runs Chosan, a brand that sells vegan-friendly, gluten-free, organic food and drink products. When asked about the main challenges she faced as a result of COVID-19, and she responded:
“As a food business owner, COVID-19 resulted in a huge drop in the sales of my products, Hibiscus sorbets and Baobab jams. Also, the conference venue that was lined up to include Chosan hibiscus sorbet on the menu, was not able to open for business. Similarly, other existing café, garden centres, restaurants and other customers were not in a position to make orders for summer due to uncertainty around lock down.
Chosan Baobab Jam was launched during lockdown. But the reduced footfall in retail stockists as well as not being able to do in-store sampling meant that there was considerable hesitancy around stocking a new product.
We also faced supply challenges. We experienced a long wait for some of the Baobab jam ingredients to become available. I would also say that reduced consumer spending power affected the sales of our products in our regular retail outlets.”
Angelica Louise Bagot of Tribal Unicorn experienced similar difficulties:
“The main challenge was having to pivot my business structure so that I could operate solely in an online space. Although Tribal Unicorn does not operate as a brick and mortar, we do attend a lot of exhibitions throughout the year and used to allow local pickups for customers. With COVID that was no longer a possibility.”
Loss of sales. Supply chain issues. Reduced demand. At face value, these challenges do not seem specific to BAME businesses when viewed through the lens of a COVID-affected economy. However, BAME-specific issues such as lack of funding, lack of governmental support and the concentration of black businesses in harder-hit sectors such as retail, are indicative of the fact that COVID-19 “exacerbated pre-existing disadvantages in the business sector.”
In a very transient, post-COVID world, the survival of BAME-owned businesses depends on a range of factors. The one factor that stands out is funding. Before the onset of the pandemic, research showed that BAME-owned businesses were less likely than their white counterparts to secure funding in the form of business loans, angel investing and government grants.
Now, as we face a business sector that has changed beyond recognition, The Conversation identifies the UK government as a possible source of relief for BAME-owned businesses.
“State-backed grants and loans should be made more accessible as an incentive to business owners who have incurred additional costs to protect customers and staff. Crucially, the process to obtain them should not be too onerous, which risks putting people off applying. Regional governments should also take care to plug BAME businesses into the supply chains of local projects in response to the pandemic.
As a community, we need businesses to get through this pandemic in one piece, and we must help protect those who are most at risk. That means working specifically with BAME business owners in creative ways to help ensure their survival.”
Beyond access to funding there are a myriad other approaches that BAME-owned businesses can explore as solutions to weathering the post-COVID storm. Among them are an increased focus on customer retention through loyalty programs, after-sales service, incentives for repeat customers and the building of loyal online databases.
We’d like to chat to BAME-owned businesses in the UK, to find out which strategies you have employed to mitigate the effects of the pandemic. Share your stories with us on social media and we’ll connect with you.
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