(Akiit.com) The world is full of black success stories. In the business world there are many examples of men and women of color living (and embodying) the American dream just as there are in the political world, the artistic world and virtually any other world one could occupy. However, it seems as though in the black community, particularly if not exclusively, there is often a disparity between success and wealth.
Here we’ll take a look at why black entrepreneurs may either not be paying themselves enough or have disproportionately little disposable income and what they can do to redress that balance.
The black tax- Are you paying it?
Whenever black entrepreneurs or successful people of color find themselves earning good money, historical precedent shows that they pay something known as the black tax. Black wealth is, let’s be honest, still a relatively new phenomenon. Therefore individual wealth can
become family or even community wealth. It’s common for black and latinx entrepreneurs to give a little extra to their family and friends who are less fortunate.
In this interesting article about the black tax the notion is addressed that we need to worry about “putting on our own oxygen masks first” as a community. Therefore, perhaps entrepreneurs should focus more comprehensively on building an infrastructure for wealth and success in the community through business mentoring and community programs.
Operational costs
Okay, so this isn’t just something that affects people of color, but many entrepreneurs have no idea how much they could save on their operational costs by rethinking the assumed paradigm on which their business is based. Outsourcing your IT to a third party like Zentech, embracing the cloud rather than investing heavily in servers or VPNs which are surplus to your requirements and embracing remote working can all help you to scythe down your operational costs.
They can also help to boost productivity and profitability, leaving you with more capital to pay yourself and your employees. No matter what you do or how big your business is, there are always ways in which you can reduce your operational costs if you’re prepared to think outside the box.
Flat rate rather than profit based salary
A lot of employees pay themselves a flat rate in fair weather or fowl, reluctant to pay themselves too much out of the business coffers even in successful times, just in case the weather is less fair in the future. However, there’s no shame in paying yourself what you’re worth or in affording yourself a share of the profits in direct proportion to what you’ve contributed to those profits. You’d offer it to your employees, after all. Why shouldn’t you afford it for yourself?
There’s free money out there. Why shouldn’t you take it?
It’s understandable why entrepreneurs, especially black entrepreneurs, would be loath to accept grant assistance in the form of free money for the government. They want to make it on their own steam and show their communities and themselves that they can make the dream come true on their own terms. However, let’s not forget the purpose of those grants; to help redress the balance of wealth and opportunity.
There’s no shame in accepting grant assistance to develop your business, especially of it means you can eventually pay yourself a salary that reflects your worth!
Staff Writer; Calvin Jones