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For many black business owners, importance of protests overshadows cost of rebuilding

‘Sometimes you have to tear something down to build a fresh foundation,’ says Marshe Wyche, whose Virginia shop was vandalized during a demonstration

The windows of Rumors Boutique are boarded up in Richmond on June 4, 2020. (Julia Rendleman/The Washington Post)

Marshe Wyche arrived at her store as dawn broke, anxious to see what the night’s protests might have brought. The door had been smashed and windows shattered, and a woman was reaching through one of the jagged openings to nab a potted plant.

As Wyche stood Sunday inside Rumors Boutique, the consignment shop she co-founded 13 years ago on a stretch of Richmond once known as “Black Wall Street,” she tried to make sense of it all.

“To see my store smashed in — it was really scary,” said Wyche, 35, who is black. “But at the same time, I am those protesters: I look like them, I’m angry like them. I understand.”

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Businesses across the country have been looted and vandalized amid public outrage over the death of George Floyd, a black man, in police custody. Many retailers, including Target and Nordstrom, had to shutter some locations amid the chaos. But for small-business owners such as Wyche, the stakes are much higher.

The number of black-owned businesses spiked 35 percent from 2007 to 2012, the most recent data available, compared with the 2 percent increase for all businesses, Census Bureau data shows. But economists and business owners say many of those gains could be wiped out by the fresh challenge of civil unrest after the one-two punch of the novel coronavirus and ensuing recession.

“Small businesses, particularly black and brown ones, have been slipping through the cracks of the federal response,” said Darrick Hamilton, executive director of the Kirwan Institute for the Study of Race and Ethnicity at Ohio State University. “The number-one hurdle is capital itself — a racial wealth gap where the typical black household has 10 cents on the dollar for the typical white household. It’s an overwhelming hurdle rooted in an unjust history.”

Have you started supporting black-owned businesses or are you a black business owner? We want to hear from you.

As many as 95 percent of black-owned businesses were shut out of the first round of the government’s Paycheck Protection Program meant to support small businesses during the pandemic, according to estimates from the Center for Responsible Lending, a nonpartisan research organization. Many of the nation’s 2.6 million black-owned companies are “microbusinesses” with few employees and even fewer connections to banking institutions.

Wyche and Casey Longyear, who is white, opened their boutique in June 2007, just as the economy was tipping into recession. They tried to get loans but, in their early 20s, didn’t have enough credit, so they used up their savings and maxed out their credit cards. They bought $10,000 worth of merchandise and got started.

They lived in their store for the first two years, sharing a twin-size mattress in a crawl space and showering at the nearby YMCA. It took nearly seven years before they turned a profit.

“I’ve been fighting the whole way, even when things are good,” Wyche said.

Small business used to define America’s economy. The pandemic could change that forever.

She and Longyear had just hit their stride: They opened two stores in North Carolina and saw sales hit $1.3 million last year. They were expecting a 30 percent jump in revenue this year until the pandemic hit.

The store located next to Virginia Commonwealth University lost nearly all of its shoppers overnight, after students returned home. Wyche and Longyear laid off all 40 employees. Monthly revenue, typically around $80,000, fell to $80.

“It has been an uphill battle trying to survive as a business during COVID 19,” Wyche wrote on a GoFundMe page that has raised more than $37,000 so far. “After the damage last night, it feels like we are trying to climb that hill with broken limbs and bleeding fingers.”

Economists warn that pandemic-related closures and the deepening recession will only exacerbate long-standing economic inequalities. The number of working black business owners fell 41 percent, nearly double the overall rate, from February through April, according to an analysis of government data by an economics professor at Stanford University. Black Americans have also lost jobs at higher rates than their white counterparts.

“We already know that black-owned businesses are overrepresented in industries that have been hardest hit by covid-19,” said Valerie Wilson, director of the Economic Policy Institute’s Program on Race, Ethnicity and the Economy. “Those businesses are more likely to face a downturn in revenue, on top of already being in a more precarious position before going into the crisis.”

The pandemic has already pushed a number of large retailers, including J.C. Penney, J. Crew and Neiman Marcus, into bankruptcy. Small businesses are in far worse shape: More than 100,000 have closed for good, and economists expect that number to grow in coming months.

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In Charlotte, James Mack is wondering how much more his business can take. Sales at his jewelry and watch store, Epic Times, have tanked since March, when the pandemic forced him to shut down operations. The business had been reopened for a week when he was jolted out of bed early Saturday by security camera footage of his store being damaged.

“I got up and ran to my store as fast as I could,” said Mack, 39, who is black. “My windows were busted up, my door was broken in, my cash registers were destroyed. There’s no way I can get back to business right now.”

He’s been through this before: Epic Times was vandalized in 2016 during widespread protests following the fatal police shooting of another black man, Keith Lamont Scott, in an apartment complex across town. It took months for customers to feel comfortable coming back, he says, and cost him about $30,000 in lost sales. “We just made it through that by a shoestring,” he said.

This time, he’s unsure how long it will take. He estimates he lost about $20,000 worth of merchandise, including necklaces, chains, bracelets and rings. Mack has property insurance but isn’t sure whether it covers riots. Even after shoppers return, it may be years before business returns fully. More than 40 million Americans have filed for unemployment insurance since mid-March, which economists say will affect consumer spending for years.

Mack started his business five years ago, with a couple of kiosks in an outdoor entertainment center. He put in all the money and has never taken out a loan.

“I worked my way up, selling one piece of jewelry at a time,” he said. “I want to stay open, I want to stay moving, but I don’t know if I can."

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Kellen Daniel, who manages Sneaker Politics, an apparel and accessories store in Dallas, is also picking up the pieces of his business.

On Friday night, he rushed to the store after a friend texted him to say it had been ransacked. Windows were shattered, and people were running out with handfuls of clothing and shoes. They appeared to be in their teens and early 20s, he said, taking advantage of a chaotic situation.

Almost all of the store’s merchandise was stolen, including dozens of designer sneakers, totaling more than $100,000 in losses. Daniel paid $6,000 to have his windows boarded up that night and is trying to figure out how long it’ll take to reopen.

“Of course I’m angry,” he said. “It was a terrible feeling seeing something like this happen to your business. But there are so many other feelings, too: anger about a murder that should’ve never happened, fear, hurt. All of that takes a toll on you.”

On Tuesday, Daniel joined a protest at City Hall, chanting “Black lives matter” in a crowd of hundreds. He has been grappling with larger questions, too, such as what it means to be a black man who condemns violence but also understands the movement.

“It’s not hard for me to separate the two: Sometimes you do have to burn s—- down for people to hear you,” he said. “But I can feel that way while also being upset about people running into my place. It’s okay to feel multiple things. It doesn’t have to be a world of extremes.”

Back in Richmond, Wyche and Longyear have spent the last few months rethinking their post-pandemic future. They’ve created a website and set up curbside pickup. They received enough money from the government’s stimulus program to cover a handful of employee salaries for three months.

The damage from the weekend has created new challenges to overcome. But Wyshe is hopeful.

“Sometimes you have to tear something down to build a fresh foundation,” she said. “We all want change. We all want this to be a better world."

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