As President Barack Obama embarked on the first of a series of trips he will make on his listening tour of America to promote job creation and growth, Black Enterprise hosted a forum to explore strategies and solutions that will ensure that African Americans will be key players in the nation’s economic revival.
Black Enterprise has dedicated the past 40 years to being a catalyst for solutions for African American entrepreneurship, wealth building, and career development, explained Derek T. Dingle, editor in chief of Black Enterprise magazine, and the conference — “20/20 Vision: A Look Ahead at Black America in the Next Economic Boom‖ is a natural extension of the company’s mission.
“This conference is one of those vehicles in which we can provide policy recommendations on a range of areas that involve African Americans, typically as it relates to business and finance,†Dingle said. “We wanted to hear from administration officials, but just as important, we wanted them to meet some of the leaders in the African American business community and gain input from them about what’s happening with their businesses and financial lives.â€
Some of the solutions discussed at the Wal-Mart Stores Inc.-sponsored conference centered on getting access to capital through initiatives such as the $30 billion in TARP money that the president has proposed be used to increase lending to small businesses via community banks. Panelists also urged entrepreneurs to fight for increased access to resources such as bonding assistance, which enables construction companies, for example, to go after higher-margin projects that will help them expand their businesses.
In addition to providing an assessment of the state of black America in terms of employment rates and entrepreneurship during the conference, BE 100 CEOs, corporate executives, educators, and economists discussed how African Americans can become vital members of the workforce of the future and job-creating entrepreneurs in the face of high unemployment. Sessions focused on the importance of education and workforce readiness, small business innovation, partnerships between small businesses and major corporations, and wealth building.
During the session on jobs and workforce readiness, Bernard Anderson, Ph.D., a member of the Black Enterprise Board of Economists and CEO of EuQuant, took a more sobering look at the pace of job recovery. He predicted that it will take much longer for the American workforce in general, but for blacks in particular, to experience real recovery than White House officials have forecast.
But Janice Bryant Howroyd, president and CEO of ACT-1 Group, said that could be a good thing because it presents opportunities for many people to become entrepreneurial pioneers and strike out on their own.
The discussion also included the necessity to increase college matriculation and graduation rates among African American students.
Dr. Michael Lomax, president and CEO of the United Negro College Fund, said that too many students drop out between their first and second years. They leave college with more skills than when they entered but not enough to compete in the workforce. He and Anderson debated the value of community colleges, which Lomax said is a good first step or alternative for students facing financial challenges or adults who must balance work, families and schools.
Americans have for the past year expressed a great deal of outrage over the bailout of Wall Street that has enabled financial institutions to endure and even thrive while communities all along Main Street struggle and in some, particularly those in which African Americans work and live, crumble. Many people are still wondering how it all happened and how to prevent another economic meltdown.
Panelists in a session on wealth-building and financial reform agreed that the blame can be placed all around.
Eugene Profit, president and CEO of Profit Investment Management, said that consumer financial literacy is a big factor. Before taking such risks they have to develop an “understanding what the investment universe is about, what the expectations are and why it should be an investment in the first place.â€
Christopher Williams, CEO of Williams Capital Management, a subsidiary of Williams Capital Group LP (No. 2 in taxable securities with $2.1 billion in lead issues on the BE investment banks list), surmised that until some real reforms are put in place, if a similar scenario were to take place again, a bailout remains the only option.
“That’s what bothers me more than anything,†Williams said.
While the federal government continues to grapple for ways to spur both lending and contracting opportunities, it is in the best interest of black entrepreneurs to seek alternative ways to build their businesses.
“At the end of the day, businesses need to grow to size and scale. We have to change how black businesses work together,†advised David Hinson, national director of the Minority Business Development Agency. “If one company is too small to become a prime contractor it needs to consider strategic alliances and joint ventures so they can come together.â€
Those that can afford to do so, may want to consider actually buying another small business, and those that can’t should think about being acquired.
Bill Mays, chairman and CEO of Mays Chemical Co. (No. 21 on the BE Industrial/Service Companies list with $208 million in revenues), said that he’s been “very blessed†to have excellent access to capital. More important, Mays is willing to share those blessings with businesses that look like good investments, which he said has made a big difference in their ability to grow.
“There’s a gentleman here who’s interested in supplying me with cleaning materials that he manufactures. If it looks like it makes any sense, I may buy a part of his company so he can have some capital,†Mays shared.
Mays also warned of the dangers of becoming too reliant on federal contracts to build one’s business. There are residual benefits of simultaneously seeking opportunities to work with private sector firms, he said.
In a one-on-one discussion between Dingle and Walmart’s Rosalind Brewer, Brewer said that to win contracting opportunities with major corporations it’s crucial that entrepreneurs to offer a product or service that will be viewed as new or innovative.
“Many black firms tend to be in the same business,
like cleaning, which isn’t very novel,†Brewer lamented.Too often firms approach companies like hers with the question, “What can I do for you?†They can forge much better relationships by starting off by providing the answer. They should ask themselves, for example, how they can help Walmart operate in the green space through sustainable products and buildings.
“The creativity that you have–bring it on,†said Brewer. “There’s an opportunity for African American and all minority suppliers to differentiate themselves and get into areas that are less ventured.â€
The Obama administration was well represented during the conference. In addition to Secretary of Labor Hilda Solis’ address during a reception Wednesday evening, U.S. Trade Representative Ron Kirk; Rick C. Wade, chief of staff to Commerce Secretary Gary Locke; and Domestic Policy Advisor Melody Barnes were all in attendance.
Barnes advised attendees to alert the White House of any discrepancies or problems they become aware of as they follow the stimulus dollars, jobs, and contracting opportunities in their communities and states. “When you see something that’s inconsistent in your community with what we’re reporting, let us know,†she said.
And while Kirk spoke of the value of entrepreneurism, he encouraged budding and existing entrepreneurs to look beyond America’s borders for lucrative business opportunities. He said that firms that export products and services grow faster, create more jobs, and compensate workers at an average 18% higher than firms that limit themselves to domestic ventures.
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