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Pandemic recovery unequal for Black-owned businesses in Maryland

Black-owned businesses have historically faced increased challenges in getting a line of credit and receiving loans from banks Jayson Williams, president and CEO of Mayson-Dixon, a business development and management company based in Prince George’s County, said. During the pandemic, Mayson-Dixon shifted some of its operations to assist businesses on how to obtain financial assistance. (The Daily Record file photo)

The coronavirus pandemic has upended the operations of Taharka Brothers, a majority Black-owned business in Baltimore.

The ice cream manufacturer lost 70% of its income due to no longer selling wholesale to restaurants, and the recovery has been slow-moving, said Detric McCoy, the director of sales and marketing. The business only received one loan to help with its finances, and it has recovered about 5% of the wholesale operations, McCoy said.

The slow-moving recovery for Taharka Brothers is a phenomenon that businesses across the country have experienced. But some Black business owners in Maryland say the recovery for their companies has been unequal, fueled by pre-existing institutional barriers and the strict conditions of grant programs offered during the pandemic.

“Black businesses are going to have it tough, regardless of the situation,” McCoy said. “Even in a global pandemic, where every business should be able to get some support, and it’s just not happening.”

Even for Black-owned businesses that have rebounded, the pandemic has shed light on the inherent barriers Black-owned businesses face, several business owners said.

Among the challenges that Black-owned businesses have faced in their recovery efforts is a lack of access to grant programs. Last year, the Paycheck Protection Program (PPP) was established through the CARES Act, the first coronavirus stimulus legislation passed by the U.S. Congress.

In the first round of PPP funding, as many as 95% of Black-owned businesses were shut out of the funding since they did not have any employees.

Kimberly Royster runs Kimberly Services LLC, an accounting services firm.

“A lot of these grants and loans were for businesses that had employees,” said Kimberly Royster, who runs Kimberly Services LLC, an accounting services firm. “So a lot of these businesses were majorly affected, but they weren’t even eligible for these grants or loans.”

Royster has helped Black business owners with their finances throughout the pandemic. The lack of employees also inhibited businesses’ abilities to apply for grants and loans, Royster said.

“They don’t really have the time to dedicate to doing the paperwork, and there’s a lot of paperwork for a lot of these loans,” Royster said. “I definitely do feel like Black businesses are in a challenging space.”

The second round of PPP funding this year made changes to include businesses with no employees, but Royster said “you had so many different people applying that it just became overwhelming.”

Cajou Creamery, a plant-based ice cream company in Baltimore, received a “very small loan” from the second round of PPP funding, co-founder Nicole Foster said. The company has experienced success during the pandemic, pivoting from mostly wholesale operations at restaurants and hotels to a “porch drop” program. 

It is also planning to open its first storefront in the coming weeks, and it began shipping nationwide during the pandemic.

But the PPP funding was the only grant Cajou Creamery received after applying for more than 10.

“If anybody really needed that support, we really needed it,” Foster said. “We have to soldier on. And that’s what we’re doing.”

Some of the barriers that Black-owned businesses have faced are more institutional — problems ingrained in society that the pandemic only exacerbated, said Jayson Williams the CEO of Mayson-Dixon Companies, a Maryland-based community development and strategic consulting firm.

Black-owned businesses have historically faced increased challenges in getting a line of credit and receiving loans from banks, Williams said. During the pandemic, Mayson-Dixon shifted some of its operations to assist businesses on how to obtain financial assistance.

“This has been true for years, for decades,” Williams said. “You’ve got institutions that are being called out on the fact that they are not lending to Black businesses the way they lend to white businesses.”

Williams has been advising clients to seek financial assistance from nonprofit lenders.

“[Nonprofit lenders] want to hear your story, not just look at your credit score,” Williams said.

Natasha Brown-Wainwright is the owner of B’More Made With Pride, a shared-use commercial kitchen in Baltimore where three restaurants, a bakery and a sweet shop operate. B’More Made With Pride has “thrived” during the pandemic, Brown-Wainwright said, and it has plans to expand to the building next door.

The business has received numerous grants during the pandemic, including “countless” from the Baltimore Development Corporation, Brown-Wainwright said. But she has never been offered a loan or qualified for a loan from a bank, she said.

“It’s just challenging to get those types of opportunities,” Brown-Wainwright said.

Sew Creative Lounge in Mount Rainier has also seen success during the pandemic. Before the pandemic hit, the business was about 90% of in-person sewing classes, co-owner Cecily Habimana said.

Early on in the pandemic, the company shifted gears to sew and distribute face masks, and it grew an online presence during the pandemic. It did not have trouble receiving grants.

Still, in-person sewing classes are not at full capacity, and the looming threat of the Delta variant means the business is not out of the woods yet, Habimana said.

“We’re just still trying to figure out the footing in terms of how we’re going to be moving forward,” she said.