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Candle Store Owner

The Story

Location  
Birmingham, AL

Project Type
Economic Development Strategy

Client Type
Non-profit

Scale

City

In Birmingham, AL, local non-profit Prosper is working to alter their last-place Black business ownership ranking through targeted analysis and action. Prosper is a coalition of community, civic and business leaders committed to creating a more vibrant, racially and gender inclusive economy in Birmingham, Alabama.

Fourth Economy worked with Prosper to establish a baseline understanding of the conditions and barriers to opportunity, engaging a range of stakeholder groups to co-create solutions and develop a set of strategies for advancing equity in the city’s small business ecosystem. In approaching Fourth Economy, Prosper wanted to know: Who is involved in the small business ecosystem of Birmingham? What are organizations and individuals doing currently to improve socioeconomic inequities? What are other cities doing in this space that strengthens their Black business ownership rate? How can we quantify a ‘good’ ecosystem?

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Establishing a Baseline

Reviewing data from sources such as the Annual Business Survey and County Business Patterns, we were able to come to a variety of early conclusions that served as the groundwork for the remainder of the planning effort. Data revealed that the largest share of Black business owners (28%) in Birmingham are within the Health Care/Social Assistance sector, and another 29% were lifestyle-oriented businesses. Data also spoke to perceptions of a lack of business growth. The number of Black-owned businesses in Birmingham did grow over the last decade, but the disparity in business ownership remains extreme. For every 10,000 metro residents, there are only 21 Black-owned businesses compared to 238 white-owned businesses. Achieving parity would see more than 7,000 additional Black-owned businesses in the metro. This data allowed us to form a picture of current conditions and aspirational benchmarks to plan for.

Identifying and Engaging Partners

In Fourth Economy’s work with Prosper, 25 interviews with individual stakeholders helped further our understanding of the history and causes behind Birmingham’s low rate of Black business ownership. Stakeholders ranged from business owners to funders, civic leaders to community advocates. Generations of systemic racism and racial stratification, disparities in quality of life and place across neighborhoods, and access to critical resources such as capital and storefront space all proved to be limiting factors. While many of these limiting factors were anticipated at the outset of the project - stakeholder input provided valuable insights and context that are essential to finding the right solutions to overcome barriers specific to Birmingham, rather than making “one size fits all” recommendations.

Co-Creating Solutions

 

With this information in hand, the planning effort moved to conduct multiple ‘Build Sessions,’ Fourth Economy’s ideation sessions, which empower those who are directly impacted to participate in building solutions. Additionally, numerous stakeholders participated in a ‘Vision Session’ to outline an achievable vision for Birmingham’s path towards solving this generational issue. Crafting a shared vision of success is more than just an idle word-smithing exercise. It allows a range of stakeholders to develop a shared language for articulating what success looks like.

Planning for Success

 

Research, analysis, and stakeholder input are synthesized to inform the strategies and recommendations that will be most effective in realizing the shared vision. For Prosper, the plan’s recommendations, broken down by timeframe, end up creating three primary avenues for impact, examining how the business support ecosystem, the local and state governments, and the metropolitan community of Birmingham as a whole can work to shift a longstanding issue of business ownership disparities. 

Working at a Cafe

Tools for Enacting Change

 

The tools that were developed within the report will provide multifaceted support to Birmingham's small business community. An ecosystem database was developed that inventories all of the assets and organizations that make up the ecosystem supporting Black-owned businesses. This tool will be leveraged to support business owners in better navigating and utilizing the ecosystem, while simultaneously helping organizations to identify areas of synergy and opportunity for collaboration or program creation. The report itself includes the findings of our economic analysis, including data assessments and qualitative insights from interviews and community meetings, which are leveraged to present strategic recommendations that Birmingham, as a community, should pursue. These recommendations are presented for consideration by ecosystem organizations, local government, and philanthropy for future investment.

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