Dawn Of The Black Millennium - Black Enterprise

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Black Enterprise Magazine July/August 2018 Issue

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America’s largest black-owned businesses have been in perpetual motion. With activities ranging from massive divestitures to major acquisitions, the chief executives of the BLACK ENTERPRISE 100s have dramatically altered the landscape of black business for years to come. For one, total sales for the BE 100s were $13.19 billion in 1997, a 6.49% drop from $14.1 billion in 1996. This marks the first time the combined sales of the BE INDUSTRIAL/SERVICE 100 and the BE AUTO DEALER 100 have declined since the two lists were created in 1988.

Last year, one of the most significant developments among BE 100s companies was the radical restructuring of the assets of TLC Beatrice International Holdings Inc., the perennial list leader with 1996 gross sales of $2.2 billion. The New York-based concern hawked its French food distribution business, which accounted for a substantial $1.9 billion of gross revenues, to a major French food retailer for $573 million. Because the division was sold in 1997, the revenues it generated up until the sale were more than enough for TLC Beatrice to remain the nation’s largest black-owned business with $1.4 billion in sales. TLC Beatrice now maintains a snack food company in Ireland, ice cream manufacturers in Spain and the Canary Islands and bottlers in Europe and Thailand. The projected gross sales for the ultra-lean entity: $344 million in 1998.

As a result, Mel Farr Automotive Group (No. 1 on the BE AUTO DEALER 100 list with $573.1 million in gross sales) is in the driver’s seat of the nation’s largest blackowned enterprise. And the transaction creates an interesting battle between Chicago-based Johnson Publishing Co., with $361.1 million in gross sales, and Philadelphia Coca-Cola Bottling Co., with gross sales of $357 million.

The asset sale and the departure of several companies from the list significantly changes the revenue and employee base for the BE INDUSTRIAL/SERVICE 100. Collective revenues plunged 6.65%, from $8.18 billion in 1996 to $7.64 billion in 1997. But the industrial/service companies show a net increase of 1,971 jobs, up 4.28% from ’96. So how can jobs increase when sales plummet? The sales drop of the industrial/service list was disproportionately impacted by TLC Beatrice Holdings’ sale of its French food division. In fact, if you factor out the sales of the No. 1 company on the list over the last two years, the remaining 99 companies actually experienced sales growth in 1997 to the tune of 4.8%.

Since no one auto company accounts for 25% of total sales, one would think that the BE AUTO DEALER 100 list would not undergo such a downward shift in revenues. Unfortunately, the volatility of the auto industry contributed to 22 new auto dealers making our listing. What accounts for the massive exodus of auto dealers? Many simply did not make this year’s ranking. And at least eight dealers sold their franchises and are no longer black-owned. Among the biggest casualties, Alvin Smith Chevrolet-Oldsmobile Inc. in Brighton, Colorado-No. 2 on our list last year with $388 million in sales–who decided to

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