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Full resolution (TIFF) - On this page / på denna sida - IV. Economics - 14. The Negro in Business, the Professions, Public Service and Other White Collar Occupations - 2. The Negro in Business
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3o8 An American Dilemma
the insufficient variety of stock and the higher prices as the main reasons
for their failure to patronize Negro-owned stores to any large extent. The
extreme poverty of most customers puts another difficulty in the way of the
Negro dealer: since he must depend on immediate cash turnover, he must
avoid giving credit j
at the same time he knows that he will lose many of
his patrons by not granting them credit.® Housing segregation is a factor
which generdly helps Negro business. When a city, however, contains
several small Negro neighborhoods, as often happens in the South, scarcely
any one of them can support a prosperous Negro store.® Negro sections
never contain any primary shopping centers 5
indeed there are few places,
except in the North, where there are even secondary shopping centers in
Negro areas. Negroes often reside close to principal business districts where
no Negro entrepreneur can ever hope to rent a store.*^
These things go a long way to explain how narrow the prospects of the
Negro retail dealers are. Still, it is not only because Negro consumers buy
in white business districts that the Negro dealer gets so little of their
patronage. Negro areas, at least in large cities, have a great number of
stores and restaurants catering exclusively, or almost exclusively, to Negroes
but operated by Jews, Greeks, Italians and other whites. Sometimes this
may be a matter of tradition, since it was only a few decades ago that many
of the principal Negro neighborhoods in the North had entirely or predom-
inantly white residents. Or it may be that real estate owners—most of
whom are white even in Negro areas—do not believe that the Negro dealer
is a dependable rent payer. Such an attitude, of course, must jeopardize the
Negro’s chances of getting a good location, Reid claims, in addition, that
the Negro businessman himself has not always seen the advantage of
locating his store in a competitive area:
Besides the fact that the Negro grocery retailer Is barred from the main shopping
districts by social and economic factors, he believes that his business experiences
greater success in a non-competitive area where there are no other stores selling
similar merchandise. The general economic truth that competition increases the
volume of business does not apply to him, he feels. Such an attitude gives rise to
isolation of Negro grocery stores even within the Negro community. The complaint
of Negro householders that Negro establishments are inconveniently located is
well founded.®
The Negro businessman, furthermore, encounters greater difficulties in
securing credit. This is partly due to the marginal position of Negro
business. It is also partly due to prejudiced opinions among the whites
concerning the business ability and personal reliability of Negroes. In
either case a vicious circle is in operation keeping Negro business down.
Part of this circle is the fact that Negro business generally is not of the size
and efficiency necessary to offer many positions which would give good
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