The effects of racism and racial discrimination on minority business development: the case of black manufacturers in Chicago's ethnic beauty aids industry

Journal of Social History, Spring, 1998 by Robert Mark Silverman

Overview

In this paper, the historical development of Chicago's ethnic beauty aids industry is examined from the perspective of black manufacturers. The central argument of this paper is that the business strategies of black manufacturers in Chicago's ethnic beauty aids industry have been shaped by racism and racial discrimination in mainstream society from the industry's inception to the contemporary period. This point is highlighted through an examination of three generations of black manufacturers in Chicago. The experiences of these black manufacturers are discussed in the context of three historical periods.

The first encompasses the years between the Great Migration and the Great Depression, when the ethnic beauty aids industry emerged as a black institution. This is a critical period in the development of the ethnic beauty aids industry, since it was when many of the business strategies used by past and current black manufacturers to overcome racial barriers to economic participation were developed.

The second period covers the years between the Great Depression and the civil rights movement, when the ethnic beauty aids industry demonstrated its resilience to economic and social turmoil growing out of racial discord between blacks and whites in society. This was a critical period, since black manufacturers in the ethnic beauty aids industry managed to emerge from the Great Depression while other institutions in the black community disappeared. It was also a crucial period, since these manufacturers became the focus of public discourse during the civil rights movement, which compromised their leadership position in the black community.

Finally, the third period examined in this paper involves the years from the civil right movement to 1990, when black manufacturers began to lose ground to white-owned conglomerates in corporate America. This period is important because it highlights how economic barriers have been reproduced for black manufacturers in the contemporary period. In addition, it demonstrates how efforts aimed at removing these barriers have been complicated by the expanding role of large white-owned conglomerates and the growing influence of the global economy in black America.

This paper also expands upon prior scholarship focusing on black entrepreneurship, and black manufacturers in particular. In the past, many scholars considered large-scale black-owned enterprises anomalies, and they characterized the black business community as being dominated by a number of small, relatively marginal, enterprises.(1) In fact, only a few general discussions of black manufacturers are found in the historical record. For example, in 1907, Washington makes reference to black manufacturers. Two of the more prominent were H. C. Haynes, a Chicago based razor strop manufacturer; and A. C. Howard, a Chicago based shoe polish manufacturer.(2) In addition, Spear briefly discusses Anthony Overton, a manufacturer of haircare products.(3)

On balance, there is little documentation of the historical development of large-scale black manufacturing enterprises. The lack of such an analysis severely limits our understanding of the relationship between business development in the black community and institutions in mainstream society. This paper presents an unique opportunity for the analysis of large-scale black businesses, since it focuses on the experiences of black manufacturers in a single industry across three distinct historical periods. The consideration of these periods together is crucial, since they highlight how firmly the ethnic beauty aids industry was established as a black institution in Chicago, and how the instability of contemporary black manufacturers in this industry is tied to the historical experiences of black entrepreneurs in general.

Black Beauty Aids Manufacturers in Bronzeville, from the Great Migration to the Great Depression

Race and the Development of Minority Markets in Black Chicago

Chicago has historically had one of the largest concentrations of ethnic beauty aids firms in America. This development was the result of a number of interrelated factors. Being national in focus, the ethnic beauty aids industry needed to be centrally located and in close proximity to major railroad lines. Geographically, Chicago was an ideal location. In the early 1900's, when the ethnic beauty aids industry emerged, Chicago was also a new city, teeming with industry, growth and opportunities. Most importantly, Chicago was a major destination for blacks during the Great Migration.(4) The Great Migration spurred the development of a sizable market composed of black consumers in Chicago.

Between 1890 and 1930, Chicago's black population grew dramatically. In 1890, Chicago's black population totaled 14,271; and it grew to 30,150 by 1900.(5) As the migration of blacks continued during the early and mid-1900's, Chicago's black population continued to expand in size. In 1910, Chicago's black population had reached 44,103; in 1920 it was 109,458; and in 1930 it was 233,903.(6) The emergence of a sizable black population in Chicago at the turn of the century, and the subsequent segregation of this community, allowed for the development of a minority markets on the South Side of Chicago. For example, Drake and Cayton commented that: