How Retailers lose out by not leveling the playing field for Black-owned beauty brands
Despite the creativity, innovation, and early adoption of natural and clean beauty products by black-owned beauty brands, we are not fully represented on retail shelves as our white counterparts. For the few brands that get into major retail chains, the chances of success are slim because black business owners typically do not have the required access to capital to sustain a long term retail strategy. The cost of getting products on the shelves, unfavorable payment terms, and the requirements for ongoing promotions can destroy a bootstrapping business.
Here’s why retailers need to create space for Black-owned Beauty Brands.
When retailers don’t create space for a diversity of options in their stores, they not only limit consumer access to potential beauty solutions, they hurt their own bottom line. A recent article from Nielson reveals the following facts about Black consumers and brands:
- Black people account for 14% of the US population and have a buying power that’s on par with many countries’ gross domestic products and they continue to outpace spending nationally
- Black consumers are paying attention to how companies are speaking to them. As they spend more, they want more for themselves and from the brands they support.
- The “for us by us” (FUBU) trend of Black-owned brands is profoundly impacting the African American path to purchase and consumer marketplace.
- Black consumers support brands that align with their lifestyles and values.
- Mainstream consumers are looking for authentic brands that are sustainable, local, handcrafted and have a social impact, most black brands check these boxes
Here’s how retailers can create space for Black-owned Beauty Brands
No grand symbolic gestures with no substance, please. Retailers that decide to follow the path of diversifying their product offering must #PulluporShutUp! This commitment means taking down the barriers that keep good businesses from succeeding
- Eliminate free-fills — not every business can afford to give away free cases product to a chain with several hundred stores in order to get on the shelf.
- Pre-finance purchase orders — If you decide to work with a brand and have taken them through a vetting process, why not help them fill your purchase orders by prefinancing them? Accessing finance is always a challenge for black businesses. If you help them succeed, you get what you need, and their business thrives.
- Rethink your payment terms — Without access to capital, many small businesses struggle even when their sales are growing. Large retailers typically request payment terms of 60 to 90 days. That’s a long time to wait to get paid. Whole Foods is great about turning around invoices in as short as two days. They are great retail partners for growing businesses.
- Highlight and Nurture these brands so customers can find them. Don’t put them in the dusty lower shelves on the ethnic aisle
- Please do not ‘black wash’ — Authenticity is non-negotiable. Do not pretend to support black-owned brands when you are supporting white brands that are targeting black customers. There’s a huge difference in whom you are helping. Customers are not stupid and when they find out, the backlash will be immediate