billion people of African descent that are around the world, not just the 40 million that are in the U.S.,” says Joshua, who has J.M. Products joint venture operations in Jamaica, South Africa, and Ghana, and a sales office in London.
But while it’s easy to say that expansion and innovation will level the playing field, these days a large part of being innovative is contingent on research and development-costly research and development that smaller companies simply cannot afford.
That’s why the black manufacturers and AHBAI are resorting to their 1980s strategy. In 1987, when Revlon President J. Bottner said majority-owned companies like his would inevitably absorb all black-owned companies in the field, AHBAI was outraged. The trade association then stepped up its Proud Lady campaign to try to induce black consumers to buy black. It worked pretty well in the ’80s, but the tactic seems to be of minimal effectiveness in this age.
While some manufacturers believe the majority of black consumers really want to buy a product made by a black company, loyalty alone can’t grow a business.
“I really respect all that Joe Dudley has done as a black entrepreneur,” says Younger-Huff. “But I’m barely cracking $200,000 a year, and I’m not wasting my tiny bit of money on a company that’s not helping me.”
Even with this attitude out there, the best defense AHBAI has to offer is a grassroots “buy black” campaign.
In future months, AHBAI will include an educational pamphlet in all black-owned relaxer kits. The notice is to educate consumers about which products are black-owned. AHBAI also plans to team up with churches to get its message out.
“We need black consumers to understand that they’ve got a choice when they buy our products out there. It’s not just whether the white companies or the multinational company will just take over. It’s whether or not we’ll let them take over,” asserts Joshua, who was chairman of AHBAI from 1997 to 1999.
“If you ask most people, they think Dark & Lovely and TCB are made by black people because they see a black person on the package, but they are not.”
NO GRAYING OF THE INDUSTRY
AHBAI has more than 20 member companies, so the issue is not that the industry’s black population is thinning. Mainly mature, decades-old enterprises are just being forced out.
“There are still a lot of small start-up companies, particularly on the professional side of the business,” says Joshua. “There are several very viable companies out there. These companies’ revenues are between $500,000 and $5 million.” These revenues are a far cry from $95 million. And, unfortunately, if the remaining companies don’t consolidate with one another, more hairs will fall.
“In terms of capital, human resources, and economies of scale, the larger operations like L’Oreal have some very potent strategic advantages vs. independent, privately held smaller companies,” says Segmented Marketing Services, Jones.
–Additional reporting by Kimberly Lanise Seals
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