Black-owned businesses across the country are expressing mixed feelings as they await the start of a second Donald Trump administration.
Some worry that the tariffs that Trump has promised to impose will increase their costs. Trump, whose inauguration is Jan. 20, has proposed adding a tax of 10 percent to 20 percent on all imports.
They also worry about the fact that they will be doing business under a chief executive whose policies and words have reflected anti-Black sentiment. They are concerned about the trend toward retreating from diversity, equity, and inclusion.
Still, others are hopeful that Trump pro-business policies will help level the playing field for Black-owned businesses. Many of them are looking forward to Trump’s promises to bring down high energy costs, establish fair trade, increase jobs, and lower inflation.
Current numbers show Black business owners can’t afford any setbacks. According to an annual survey by the Census Bureau and the National Science Foundation, there were 161,031 U.S. firms with majority Black ownership in 2021 who made up only about 3 percent of U.S. businesses. They accounted for only 1 percent of gross revenue from all U.S. companies.
Black business owners are trying to figure out if a new administration will help or hurt those not-great statistics.
The estimated annual revenue loss for Black-owned businesses dependent on imports affected by tariffs could range from $1.8 billion to $3.6 billion, Black Enterprise reported on an analysis by William Michael Cunningham, an economist and CEO of Creative Investment Research, based in Washington, D.C.
Olajuwon Ajanku, the cofounder and creative director of East Side Golf, based in New York City, expressed uncertainty about the proposed tariffs because he just doesn’t want to spend more money and push it on the consumer.
The company launched in 2019 offers t-shirts, sweatshirts, umbrellas, puffer suits, skirts, polos, jumpsuits, socks, headbands, and arm bands for golf enthusiasts — all made in China. It’s said that the heavy cost of tariffs on China and Mexico could be forced onto retailers and, then, onto the consumer. The tariffs could engineer a left turn for all businesses.
“It’s 15 percent to 20 percent cheaper to manufacture in China versus the United States,” Ajanku said.
Oren Waters, president and CEO of Sleep Enhancement, based in Altadena, California, agrees with Ajanku.
“We need checks and balances,” said Waters, whose company manufactures pillows designed to improve sleep.
On the other hand, there might be a good side to the tariffs for all business owners. Many Black business owners like Waters are silently counting on those sweeping tariffs and lower energy costs to provide a more level playing field. They see Trump’s tariffs as a negation tool to promote free trade.
Trump accuses the global market of taking advantage of the United States and not treating its goods fairly. The goal of the tariffs is to incentivize and force manufacturers to bring factories and plants to the United States, creating more jobs in the long run.
“To have things manufactured in the United States is a problem,” said Waters, the inventor of the Foot Free Pillow, which is manufactured in China, referring to the high production and shipping costs associated with doing business in America. “That needs to be changed so we can do more business in the United States,” he said.
The Original Foot Free Pillow, established in 2002, is a wedge-shaped cushion placed between the feet and sheets designed to relieve ingrown toenails, bunions, plantar fasciitis, and fibromyalgia.
But business owners are concerned about potential changes not only because of their costs, but also costs that will trickle down to the consumer.
“The goal is for the consumer to have more liquid to buy products,” Waters said.
Labor costs and U.S. safety restrictions for workers are driving American business owners to employ labor overseas. Business owners who prefer to invest in cheap labor will look to Africa and other places like Vietnam, Turkey, or India.
In the meantime, Trump has proposed a 25 percent tariff on imports from both Mexico and Canada, two of the United States’ biggest trading partners.
Business owners like Robin Johnson, the inventor of “I Dare You To Create”, a productivity framework card game for entrepreneurs, are thinking forward so they can survive any changes coming after Trump’s inauguration.
“I chose an American manufacturer because of the changes in the administration,” said Johnson, who is based in Los Angeles. “It does dip into profits but profits is not my mission.”
The fear of the second Trump administration isn’t only rooted in wealth building but also the anti-Black climate he has helped welcome that rubs Black entrepreneurs the wrong way. Even if they do support his economic policies, they might not like him as a person.
The term “Black-owned business” has become the label for a movement to build generational wealth among Black Americans. Now, those Black business owners are rethinking being known as such and hiding their identity.
“Is Black a dirty word again? Should I … hide my identity for the sake of the mission?” asked Johnson, whose goal is to create the largest number of Black business owners in this country through her card game “I Dare You To Create.”
“I am a Black woman and it’s hard for us to fundraise,” said Johnson, who is also the founder and CEO of Indie Creator Fund, a 501(c)(3) program that helps Black entrepreneurs and freelancers start, scale, and sustain their businesses by covering the cost of corporate filing, general liability insurance, equipment, and rent for a brick and mortar.
She points to similar investment companies such as the Fearless Fund, an Atlanta-based venture capital fund that shut down a grant program for Black women entrepreneurs after a legal challenge alleged reverse discrimination.
“The laws that were put in place to protect us were taken away,” Johnson said. As a former angel investor, “it really broke my spirit,” she continued, referring to the core mission of the conservative political movement, whose tactics include anti-DEI lawsuits, anti-DEI legislation, and routine attacks on DEI in the public arena.
“You have to play the game regardless,” Johnson said. “It’s going to force us to build.”
It’s unclear if there are any federal initiatives planned to boost Black-owned businesses specifically under the newest iteration of Trump’s presidency. But there was an increase in the number of Black-owned businesses the last time he was in office.
And there is excitement amongst Black- owned businesses and their future.
“A rising tide lifts all boats,” said Waters, who comes from a Gold Star family, which is a family who has lost a loved one while he or she served in the military. “We look forward to saying ‘Made in the USA,’ “ Waters said.