How Black Business can b e seen as a vital economic engine in our communities

1. ABL Changing the Paradigm about
Black Business
Introducing
“Community Economic Value Add” (M)
(CEVA (M) )
A Presentation by: Joseph R. (Uncle Joe) Hudson
The Hudson Strategic Group, Inc.
770-994-4466 www.hudgroup.com

2. “Any group that does not have an
economic structure is heading for
trouble. The groups that hold the
most control over their financial,
human capital and markets will be
the most competitive groups.”
Washington Post, May 25, 1998

3. CEVA
(Community Economic Value Add)
The idea is that value (real or perceived) is
created when the return on the entire
community opportunity for stabilization and
growth is greater, through an active
recognized strategic approach, than the
negative impact of allowing our inner city
communities to lie fallow awaiting
government largess.

4. ABL Advocate for Building our own
Economic Base
Building a Black business economic base: • Doing business with other Black
•Our way of Paying our Economic Rent businesses who do the same
• Philanthropy and giving to Black
•Rent from Business and community owned and community located
support our ROI institutions
•Recognition of the Economic
contribution to the entire community Effort designed to GROW our Black and
Entire Community through:
•Community Leadership
• Providing a Return on Investment
We pay our rent by: (ROI)--Business and Economics
•Hiring local People contributions
• Political support and leadership
•Collecting and Paying Taxes (Payroll,
• Churches-- supporting the social
Sales, Unemployment, etc.) network
• Serving as Sales/Collection Agents for • Civic & Social—leadership and
GA Lottery and other Statewide support for important community-
initiatives wide objectives
• Philanthropy --supporting the non-
profit community

5. Each Congress Works on
1. Changing the Paradigm through the
recognition and articulation of the Black
Businesses Economic Value
2. The development and expansion of ideas that
demonstrate and support the notion that Black
business are an Economic Engine within our
communities and cities
3. Developing Strategies to do something about
our communities economic conditions utilizing
Black businesses

6. What We’ve Learned from Past
Congresses
• Black Community and Black Businesses as an Asset are
UNDERVALUED!
• Politically Black Communities have been used before but
never rewarded. --NEEDS TO BE BUILT INTO
OFFERINGS
• Black Community Undergirds Community Economics--
MAJOR EMPLOYER and Major Contributor of economic
benefits WITHIN BLACK COMMUNITY
• Need to REPOSITION BLACK BUSINESS from Perception
of Entitlement to a Fact of Asset Value with a Return on
Investment.

7. Moving Forward--New Efforts
Bring Program and Outcomes into modern era.
•Old conversation borne in civil rights era around
socioeconomic principles-hard to except and
appears to be entitlement and doesn’t appear to
do anything for the good of the order.
•New conversation –Changing the Paradigm must
articulate the VALUE and economic benefits of
supporting Black business
•A different Investment Strategy that positions
Black businesses as important community economic
engines driving community development as a result
of their Transactions

8. The 5% Solution Spending Investment
Strategy Plan for Economic Development
1.
Goals/ 2. 3.
4.
5.
Increase times
Outcomes dollar turns 5% per
Increase marketing
of Business
Develop a method
Black Businesses
Arrange financial
year to control our land resources for
Desired and real property
form alliances
Black Business
Provide
Customer Value for Provide
Assure
services and
Help Increase competitive
/Community investment quality goods
market share and Fair products that
and services Pricing reflect actual
Expectations ROI
needs
Locate in
Business Operate Provide top Know Have areas A willingness
Professionally level customer adequate
Must Perform Expertise needs cash-flow
accessible to to collaborate
customer
Well
Resource
Black Business to Black Business to Black Business to
/Community Consumer Black Business Black Organization
Adjustments
8

9. Overcoming the Stakeholder
Fatigue of Past Efforts
Fatigue is the result that happens when you make an
offers using words that describe something that people
associate with lack of benefitor pain.
When that offer is repeated over and over with the
same offensive words—People become non-believers
or fatigued our Communities are FATIGUED when it
comes to Black Business development and leadership!!
Therefore, any new Offer must be Reframed
declaring a different type of success that is easily
recognized with new benefits understood
Not just in Word, but in Fact

10. Changing the Paradigm
From:
•Negativity
•Favoritism
•Unearned support
To:
•IMPORTANT ECONOMIC CONTRIBUTORS &
NEW LEADERSHIP
•COMMUNITY ASSET THAT IS NOT JUST
SUPPORTED BUT REQUIRED!
•WISE INVESTMENT WITH IDENTIFIABLE
RETURNS

11. New Expectations
• A Return on Investment Strategy (ROI) leading
to an INHERITANCE for Future Generations and
Better Communities
• The Acknowledgement that BLACK BUSINESSES
PRODUCE ECONOMIC RETURNS. Economic
Returns that can be Recognized by ALL Parts of
Community
• ROI Approach recognizes that Spending with
Black Business is an really an INVESTMENT not
an entitlement with returns that lead to the
achievement of Community Economic Value-
Add (CEVA)

12. The Black Community is an Eco-
System
• Recognizing that the entire community
forms an Eco-System that must be
considered.
• The Eco-System demands an Enterprise-
wide view
• The Econ-System demands you meet their
expectations if you want participation

13. Examples of Major Stakeholder Groups
Return on Investment (ROI) Expectations
1. Community ROI = Economic Impact (Jobs, Taxes,
Services)
a) They Invest in Infrastructure, Education, Tax Breaks
2. Investors ROI = $Return vs. $Invested
a) They Invest Capitol (Debt or Equity)
3. Employee ROI = Pay and Secure Environment
a) They Invest Waking Hours, Commitment (Emotional)
4. Black Businesses ROI= Growth & Development
a) They Expect Community Support through Opportunity,
Contracts, Business w/each other & the community.
b) They take the Economic Risk
c) They Expect Respect from the market place

14. Hence we must CHANGE THE LANGUAGE!
Around Black business success and Reframe
our Value
• Example--Change Procurement Outcome (or
couple with) to economic indicators
– Jobs created
– Payrolls
– Taxes Paid
• Change language about HOW we Speak about
OURSELVES to economic—i.e. Gourmet Services is a
major employer of Black People with 2,100 employees
• Tie outcomes of utilization to driving of economic
benefit for ALL i.e. How Black businesses affect the
overall success of Atlanta

15. The 5% Solution our Tool
Self-Help--Based on our Spending, Our Money,
with Our Businesses and the Economic Return
created by the spending:
•5% more Black Consumer Spending with Black
Business
•5% More Black Business 2 Black Business Spending
•5% More Black Business support of local Black
Institutions
(Could it be More—Sure but let’s get started first!)

16. The 5% Investment Through
Spending
• Economic Values CAN BE SEEN as important by
Almost ALL Atlanta
• The DISINCENTIVE of doing business with Black
business is MITIGATED by the expected economic
return
• The idea of an INVESTMENT THROUGH
SPENDING creates a Black Business Leadership
approach to total community economic
development not just what will the government
or others do?

17. The 5% Investment Through
Spending (The 5% Solution)
• Can articulate a Competitive Advantage for
Black and minority businesses
• Can be expected to produce Economic return/
ROI that ALL can see.
• Can be used to “fortify” use rather than ‘justify”
use of Black contractors etc.
• Demonstrates how the monies funnel down to
our communities through Business
employment---i.e. can be used to express
benefits to community expected from large
projects-

18. Use 5% Solution to Create Competitive
Advantage
• Shared Values--Driving Economic Benefits for
ALL
• Helps include ALL citizens through job creation as
benefactors
• Can localize benefits to a particular community
• Makes small business an economic engine worthy
of support not just conversation
• It is Visible to ALL and can be Measured--the
Results of Doing Business with Black Firms is a
Great Benefit to Atlanta as a whole! It supports
what others believe about Atlanta!

19. Our Economic Underpinning of Value
Dr. Danny Boston & Dr. Ed Davis
• Atlanta #1 Desired location of Black Business
• Metro Black Businesses create over 56K Jobs--wo/
Support
• 44% of Black business located in high risk areas—
underserved communities
• 66% of employee reflect ownership-Makes it
clear on beneficiary of supporting Black Business
• Relationship between job skill levels and job
requirements-Not as Challenging among MOST
Black Businesses (Employer of Last Resort)
• Economic Impact of Black business $24B

20. Re-Framing our success as
Undeniable Benefits to Our Cities
• 5% Increase in Spending with Black
businesses would CREATE 24K jobs with
an estimated 18K of them Black People
• 5% Increase in Spending Nationally would
LOWER Black unemployment from 13.6%
to 10.4%

21. 5% SUCCESS!!!
• 5% Solution is Proving to be a Success in
turning the Dollar over in our Community
and leading to economic benefit
• Here’s are some examples of how!

22. Selected Data from
CurrentSurvey
How successful were you:
•30% Extremely
•48% Very
•22% Not Very
Percentage of Increase
•Greater than 5%=48%
•3-5%=22%
•1-3%=26%

23. Selected Data #B
Top 5 Areas of Success
•Medical Services=66%
•Legal Services=71%
•Personal Care—93%
•Restaurants=85%
•Home Maintenance=66%

24. Selected Data #C
Age of respondents
•Over 55=56%
•Over 65=19%
Age of Business
•More than 10 yrs=60%
Percentage of employees of the businesses
being Black= more than 84%

25. Selected Data #D
Independent Contractors=64% Black
Percentage of Business we do with with
other Black Businesses
• 50-75%=35%
• 25-50%=25%

26. Selected Data #E
Percentage of Business dependent on Black
Consumers
• 75-100%=25%
• 50-75%=25%
• 25-50%=25%
• 1-25%=25%

27. What Can YOU DO?
• INCREASE your SPENDING with Black Business
• Express your BUSINESS SUCCESS IN ECONOMIC
TERMS (Result of your Transactions)
• Put PRESSURE on other organizations to begin
using Economic Terms
• Increase your GIVING with Black Organizations
• Help ABL and others IMPLEMENT the Plan
• STICK WITH IT even if you can’t see the results!
• Help us DEVELOP SOLUTIONS and Approaches
FOR OVERCOMING this issue

28. We have the “Cash and the Cache”
Express our success
• How a Spending Investment Strategy produces ECONOMIC
BENEFITS that are difficult to deny
• DISAVOW language centered around individual
achievement USE language of Shared Value achievement
• Our HISTORY OF OVERCOMING has shown we are capable
of maintaining our communities
• The NEW ENTERPRISES WE ARE CREATING & MARKETS
provide the underpinnings for future success
• We are so much SMARTER AND MORE SOPHISTICATED as
business owners today

29. Joseph R. (Uncle Joe)Hudson
• Founder & Chairman
• Hudson Strategic Group
• 6856 Tara Oaks Dr
• Riverdale, GA 30274
• 770-994-4466
• www.hudgroup.com; www.joseph rhudson.com
• jrhudson@hudgroup.com