The Black Informant

An addendum to yesterday’s post

Since writing a bulk of the post on the Black hair care and beauty industry back in 2006, BOBSA (Black Owned Beauty Supply Association) has made some additions to its services for those interested in entering this field. I am posting the following because I am still getting e-mails/comments from folks looking for advice on how to get into the business.

Beauty Supply Store Consulting Services
BOBSA’s mission is to assist entrepreneurs in their goal of owning and operating Black Owned Beauty Supply Stores Nationally and Internationally.

Through experience and partnerships with many of the nations leading experts in the hair care and cosmetic industries, inventory control systems, commercial real estate and brick and mortar store operations management, BOBSA is in a position to offer you ‘insider’ level information that provides for a greater opportunity of business success.

Whether you are opening a new brick and mortar beauty supply store, or need help with your existing store front, we provide consulting services from industry professionals who are committed to your entrepreneurial venture.

Our Business Offerings Include:

Business Plan Services
Retune or develop a solid business plan leveraging the experience of industry financial professionals

Contract Review Services
Before you sign on the dotted line, ensure that you are making a sound business decision based on industry standards or your specific business needs.

Inventory Services
Gain an understanding of how the right product mix can be the key to your business success.

Inventory Control Services
Manage your inventory through one of the many Point of Sale Solutions available to you.

Product Merchandising Services
Understanding product placement is just as important as purchasing the right product. Placement helps decide if a product ’sits’ on the shelf or in your customer’s hands.

Marketing Services

BOBSA Brand Licensing
Carving out a name for your business in such a crowded market can be difficult. Obtaining a license to use the BOBSA brand has immediate recognition nationally and internationally.

Private Label Product Development Services
When it’s time to take that great product idea and make it a reality, our experience in Private Label Product Development Services could make the different between a rewarding experience and financial headache.

[Read the rest by clicking here]

“They took it from us!”

In a recent conversation with a friend of mine, she was expressing her anger about how the Asian community “took away” our share of the Black beauty industry and that they should be made to reinvest some portion of their earnings back into the Black community. Interesting enough, I actually wrote about this very issue back in 2006 (“Are they taking over or did we give them the keys?”). I am going to repost that entire article in a moment, but first, allow me to elaborate a little on a point that was not talked about enough in that particular article.

Living and doing business out here in California has given my wife and I a very interesting perspective on how other ethnic groups do business. From our experience, when it comes to large investments such as buying a home or business it is not uncommon to see how the entire family is pulled into the process. On the flip side, many Blacks that I have encountered over the years usually go into these major investments alone. For the Black-owned businesses I have seen that are successful, the family core played a major role in their success.

Here in southern California, frozen yogurt chains are popping up all over the place. One of the more popular chains is Pinkberry. According to wikipedia, a single store can bring about $250k per month. Guess who is behind this particular trend? You guessed it–Koreans. While this is part of a trend that originated in Korea, they were able to import it here to America and pretty much corner that entire market. Even their competition is Korean-owned. No doubt, there is a concerted effort to keep this business “in-house” (family and community), and from what I have seen they are doing a pretty good job. Again, on the flip side I have seen Black-owned beauty shops and salons either go under or get bought out by Hispanics or Asians for one of two reasons (or both). 1 - Other Black-owned beauty shops/supply stores are seen MORE as a competitor than a co-laborer or in the same field. This oftentimes result in that particular business becoming an island all to itself and 2 - No real concerted effort to control distribution.

Now, as far as the “They took it from us!” accusation, here is what I posted back in 2006.
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“Betrayal epitomizes the historical occurrences, which have hindered the recognition and respect of our greatness in the Black Hair Care & Beauty Industry today. Though many groups perpetuate crimes of economic parity, we are found to be the most guilty.

Black Americans handle vast sums of money, but somehow we have been taught to see our-selves as poor people. We are not poor–we just handle money poorly. Out of every dollar we spend, 95 cents is spent outside of our community and only 5 cents of every dollar within our own community…

If, we are in control of our money, we have only ourselves to blame for giving our economic power away. Many of us do not realize how much damage we cause when we choose to spend our money elsewhere. Likewise, we do not realize how economically empowering it can be to spend our money in the community.

Consider that other communities are thriving because they understand this principle. If we continue to choose “lazy economics” instead of “industrious economics” we will succumb to the pressures of the open market. Agressively, capitalizing on economic opportunities and not ALLOWING them to diminish, we improve our communities instantly!” (source unknown).

As a entrepreneur, I really took the issues raised in this documentary to heart. Couple that with reading the excerpt above and it just made it even more difficult for me to sit down to write this post. While the economics of the hair care industry may not be considered “blog material”, as I stated in an earlier posting this industry represents our last great opportunity to secure the financial independence of our community. To not take this issue seriously would be a costly mistake. More »

Black-owned bank reports growth

7th Largest Black-Owned Bank Reports 37% Increase in First Quarter Net Earnings

LOS ANGELES, CA (BUSINESS WIRE) - Broadway Financial Corporation (NASDAQ: BYFC), parent company of the 7th largest Black-owned bank in America Broadway Federal Bank, today reported first quarter net earnings of $607,000, or $0.32 per diluted share, up $163,000, or 36.71%, when compared with net earnings of $444,000, or $0.23 per diluted share, in the first quarter of 2007. The increase in net earnings was primarily due to increased interest-earning assets and a higher net interest margin.

Chief Executive Officer Paul C. Hudson stated, “Bank earnings are benefiting from strong loan demand and increasing net interest margins.” He went on to state, “Going forward, we are focusing on deposit growth and asset credit quality.” (more…)

Yeah, bail them out

Living here in ground zero of the sour real estate market (Inland Empire), I can tell you that stories like the following are very common.

Owners trash, strip their foreclosed homes
Fixtures, cabinets, tubs, sinks, even stairways face wrath of dispossessed
By Jerry Kronenberg

Jack O’Leary has seen foreclosed homes where ex-owners put paint on the carpets, anti-bank graffiti on the walls or took everything but the kitchen sink - then stole that, too.

“I’ve gone into houses where the light fixtures are gone, the toilets are gone, the kitchen is gone. And when I say ‘gone,’ we’re talking stripped down to the bare walls,” said O’Leary, a Brockton Re/Max real estate agent who specializes in foreclosed homes.

With a growing number of Massachusetts homes falling into foreclosure, real estate agents say more and more ex-owners and tenants are vandalizing properties on their way out the door.

People rip up walls, kick in doors or take bathroom fixtures or copper wiring - sometimes to sell, other times just to get back at lenders.

Broker John Agostinelli just put a Watertown condo on the market where someone removed all doors, kitchen cabinets, appliances, gas fireplaces - even the light switches.

“This property has the most damage we have seen of approximately 30 properties we’re (currently) listing,” said Agostinelli, who’s selling the place “as is,” knocking down the price some $90,000.

O’Leary has reduced an Easton split-level ranch’s cost by about $200,000 because someone ripped out appliances, sinks, toilets and more. (more…)
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For sale: Local homes left in shambles
By Sam Spatter and Ron DaParma
TRIBUNE-REVIEW

[…]

Watkins and Truong found one of the worst properties they’ve encountered on Yukon-Ruffsdale Road in Ruffsdale, Westmoreland County, a four-bedroom house.

They found debris throughout, such as wood piled on the floor, plaster ripped from walls with large holes and some of the wiring pulled loose.

“Most often we find properties have been trashed or have nonworking appliances, clothing, broken and damaged furniture or garbage on the premises,” Watkins said. “That’s not always the case since some houses are spotless, but the vast majority have these items left in them.”

Broken windows are boarded up, and where the plumbing has been removed, it is not replaced, Watkins said. His work includes cutting the grass, trimming shrubs and trees, and providing yard maintenance. If he finds a workable appliance left in the house, he removes it, and often offers it free to a needy person. Discarded clothes are usually donated to the Salvation Army. (more…)

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Trashed Foreclosed Homes
kold.com
Karla Ronquillo

A new trend is being seen more and more among foreclosed homes. Homeowners are taking out their anger by trashing the home before moving out. Realtors are seeing everything from piled trash in the yard, missing cabinets, to gutted appliances.

It is too costly for banks to fix the damage, so they end up losing money by selling the home “as is”. But when homes are damaged, the property is much more difficult to sell.

Foreclosed homes are usually a bargain for house hunters. In cases of damaged homes, the cost of cleaning, fixing and replacing is up to the buyer.

Some lenders are offering “Cash For Keys” to people who are losing their homes. (more…)

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Loan crisis pushes owners to trash homes
By RAY WEISS
Staff Writer

With its English, country-like elegance, the brick house on a hill in Ormond Beach would fit on the cover of Better Homes & Gardens.

But behind the walls is a vacated interior that lacks the most basic essentials, including appliances and toilets. They are gone like the owners who once lived there, a casualty of foreclosure.

“We see people who vacuum and clean when they leave. And then we get other houses that are trashed, stripped,” said Frank Cardarelli, a Port Orange real estate broker who has specialized in foreclosures for 25 years. “Anything that’s built or attached is part of the mortgage, and banks can go after them.”

But broke is broke.

Cardarelli, who works for RE/MAX All Pro Realty, said he has seen air conditioning units, hot water heaters, sinks, closet doors, even heating vents ripped out and taken when owners left their homes, no longer able to pay mortgages.

“It goes from mild to severe. Some people take everything. It’s incredible,” he said. “But there’s not much value for what they’re taking, like a used ceiling fan or rusted water heater.”

Larry Silvia of Ormond Beach said he’s paying the price of living next door to an empty, foreclosed house. High weeds bordering the houses have brought unexpected visitors. (more…)
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Before someone tries to go there, NO I am not suggesting that this is representative of all homeowners who had to go through foreclosure. This is just a friendly reminder of who is included in that proposed wide net of government benevolence.

The World Beyond Your Little ATM Card

Three Chinese banks in world’s top four: study
AFP

Three Chinese institutions were among the world’s top four banks at the end of 2007 at a time when the market capitalisation of Western banks was suffering from a global financial crisis, a study showed Wednesday.

The number one spot in the rankings, compiled by the Boston Consulting Group, was occupied by the Industrial and Commercial Bank of China, with market capitalisation of nearly 340 billion dollars (218 billion euros).

In second place was China Construction Bank, followed by HSBC of Britain, Bank of China, Bank of America and Citigroup of the United States.

The study found that banks in North America and Western Europe had suffered a loss of 695 billion dollars in market capitalisation at the end of 2007 while their counterparts in emerging market countries Brazil, Russia, China and India had seen their market capitalisation increase by 753 billion dollars. (more…)

Just admit that it was a bad gamble

Pay special attention to the following quote that you will hear in the video:

“Why pay a $3,200 payment on a 1200-square-foot home? It makes no sense,” Stephanie Valdez adds.

“That’s what you agreed to do when you bought the house,” Kroft points out.

“Fine. If the value is going up. But we’re not going anywhere. The price or the value is going down. It makes no sense because we will never be able to refinance and get a lower payment. There’s no way,” Stephanie Valdez replies.

Here in the California market, folks were making a killing during the height of the market. Many (NOT ALL) of these folks knew they were taking a risk, but assumed that values would increase. As we can see today, it didn’t.