According to the Census, there were less than 125,000 Black owned businesses in the U.S. in 2019. Despite the number of new businesses that have emerged due to the growth of e-commerce and the COVID-19 pandemic, minority-owned businesses were severely impacted by the pandemic. A 2021 report from McKinsey found that unequal access to capital, the most recent racial reckoning, and a pivot to the digital economy exacerbated existing racial inequities. Black-owned businesses suffered greatly and have a long-road to recovery, but it varies by sector and region. Three owners share how the pandemic has affected their businesses and how they have managed to survive, when so many others have forcibly closed their doors. Each has a physical location and an online presence that was deeply affected by the COVID-19 sales and e-commerce environment.
Alyza of Sw3at Sauna
Alyza of SW3AT Sauna Studio in New Jersey
SW3AT Sauna Studio provides infrared heat therapy, and serves as a wellness, fitness, and beauty tool for weight loss, detoxing, immune system boosting, and skin purification. The client base consists of young professionals, athletes, and those seeking new self care methods.
How did COVID affect your business?
I started my business in 2015 as an apparel line but developed it into a brick and mortar in 2018.
In February 2020, we heard about COVID but never truly thought it would affect the business to this magnitude. March came and boom, the doors closed. Due to the abruptness of closing, we instantly went into survival mode. We had some working capital that could get us through for a few months, but due to the regulations put in place from our state, we were required to close for three months which led to us laying off staff. We were able to reopen in June 2020, but we were already feeling the financial challenges. We were rolling into our slow season, so we knew the bounce back would be even harder.
Then, two months into re-opening, I got orders to be deployed for a year to the Middle East. So now I was challenged with rebuilding my business remotely from across the globe with the weight on my wife/co-founder to manage things on the ground. Fortunately—or maybe unfortunately—as a person from a disadvantaged community and a veteran, I was built for this type of adversity.
My wife and I started to brainstorm, we revamped our entire website, introduced more products, and created an e-commerce store. If we had had an online store before, our income would have continued despite our physical location being closed; that was a big lesson learned there. We also used the time while closed to really immerse ourselves in the community. We felt like despite being closed, we should use our network for good especially with more time on our hands.
Has your business recovered?
At the beginning of 2021, we really rounded the corner and decided to open another location in June. The pandemic made us realize that we truly created a gem in our community. Our business is a unique concept and once we broke out of the slow summer season and people became a bit more comfortable with going out, we began to thrive. Aside from the fact that saunas are proven to boost your immune system and combat certain ailments, our facility has personalized saunas inside private suites. This model made people comfortable, even when fitness centers, masseuses, and an array of other group activities were no longer an option for people. Mental health strain was really taking a toll. New clients booked with us as they searched for a safe wellness option.
What challenges do you currently face?
Consumers’ hesitation surrounding social distancing, physical touch, and cleanliness is not going anywhere and that’s when we learned that this model would thrive in other places as long as we got the word out about what we offer. As a small business, advertising dollars is always a struggle but we make every effort to be as creative as possible. Since it’s a newer concept, educating the masses on this holistic wellness technology is an undertaking, but COVID proved to us that we have something special and we refuse to give up.
Stephanie Hoyte
Stephanie of fashiondollzboutique.com in Florida
Stephanie Hoyte started her online apparel business in 2019. After she lost her job in December 2020, she opened a kiosk in the Orange Park Mall in Jacksonville, FL. She made $20,000 in two weeks.
Was your business affected by COVID?
I was lucky that my business was not affected. It actually grew and did very well. I was able to grow into a brick and mortar store in the mall, making between $10-30k monthly. The mall closed early and masks were required, but otherwise there were no additional restrictions.
What strategies did you implement and why?
I increased my marketing skills. I marketed on all social media platforms daily, as well as email and SMS marketing. I implemented those strategies because customers may not be able to leave home to shop, but they were on social media and online daily. I knew it was a way to connect to potential and repeat customers.
How has your business changed by the pandemic?
It changed amazingly in terms of revenue. We have done over $475,000 in revenue year to date and this was my first full year as an entrepreneur. I also was able to add additional services, such as business mentorship programs to teach other entrepreneurs how to start an e-com business and make money online. I was a business manager at JP Morgan Chase for over 15 years, so I turned that expertise into another stream of income.
Do you think these changes will make your company better in the post-pandemic future?
I am currently working on expanding my business to a bigger location and offering more services and products, as well as mentorship programs and networking groups to help women. I’m actually a part of a huge networking conference with Master P, Les Brown, Coach Stormy, Mzskittlez and others because of the way I elevated in less than a year. Seeing where I came from and where I am now in life and all of this happened in less than a year is a huge blessing.
Ziba’s Bistro
Chef Ziba of Logan Street Market in Kentucky
How did the pandemic affect your business?
In March 2020, Kentucky got its first confirmed case of COVID. Shortly after, the state issued several emergency orders, including work from home and carryout/delivery only for restaurants. As people immediately stayed home and didn’t dine in at restaurants, we immediately felt the financial impact. But, I believed that things would get better soon. Although things are better now, they are not back to pre-pandemic normalcy.
Besides financial challenges, we experienced difficulty maintaining our staff. Most had to go on unemployment. We also got a huge number of people claiming they were working for us and we had to report those unemployment claims as fraud, which caused a lot of stress and labor. My wife and I, as owners, also had to work more hours because we did not have enough business initially to give staff consistent work.
Since we are a small business, we had concerns for everyone’s health and safety as well; if someone was sick, they stayed home and got tested. There were increases in food costs due to the pandemic and there was difficulty finding some of our inventory as well. We also didn’t receive any money from the Restaurant Revitalization Fund. The money ran out so quickly that it left out people like us—small businesses that are minority-owned—when it really could have helped us.
What strategies did you implement to stay in business?
We paid to upgrade our website so that we could take online orders and we partnered with other delivery services.
Has your business recovered? What challenges do you continue to face?
We opened our restaurant just six months before the pandemic. We never could have prepared for a pandemic that has lasted this long. It has been going on for nearly 19 months now. We have not returned to our pre-pandemic numbers, but we continue to do more catering and family menu offerings. We hope to change our website so that it looks better. Fortunately, most of our staff have returned to work. We continue to run on the bare minimum to reduce our spending and only pay for what is mandatory including not paying ourselves if necessary.
