
Black business owners and those from Asian and Other Ethnic Minority backgrounds face persistent disparities in business outcomes, with systemic disadvantage playing a key role.
This is revealed in a report Alone together: Entrepreneurship and Diversity in the UK, published today by the British Business Bank and Oliver Wyman.
The report examines the profound effects ethnic and economic background, gender and geography have on business outcomes. The research will feed into the Commission on Race and Ethnic Disparities established by the Prime Minister.
After starting a business, black business owners report a median annual turnover of £25,000, more than a third less than white business owners at £35,000. Many more fail to make a profit with figures of 28% compared to 16%. And fewer meet their business aspirations.
Just 30 per cent of black entrepreneurs say they met their financial aims and only half met their non-financial aims. This compares unfavourably to white business owners, where more than half say they met financial aims and 69 per cent met non-financial aims.
The success rate for starting up a business for black entrepreneurs is in line with the UK average but entrepreneurs from Asian and other minority backgrounds have a significantly lower success rate, making up around 3.5 per cent of business owners but more than 8 per cent of those who wanted to start a business but did not succeed.

Women experience the biggest disparities with more than a third (37%) of black female business owners and 36 per cent of female business owners from Asian and other ethnic minority backgrounds making no profit last year, compared to 15 per cent of white women.
London was found to be the toughest place in the UK to be an entrepreneur, with just 71 per cent of businesses reporting a profit in 2019.
The report found that irrespective of ethnicity and gender, household income was crucial to entrepreneurial success. Business owners with an income of £75,000 or more were most likely to report profit last year compared to those on an average annual income of less than £20,000 (87% versus 76% respectively).
What should be a level playing field is littered with obstacles, many of which are products of a complex system of racial and gender disadvantage
Wealthier business owners were nearly twice as likely to see their business grow by at least 20 per cent last year. The median turnover of business owners with an income of £75,000 or more is 12 times that of business owners with an income of less than £20,000. Many more of those with higher household incomes report meeting their financial and non-financial aims.
The Bank’s CEO Catherine Lewis La Torre, said: “This research provides us with a clear evidence base to help us understand the scale of the barriers faced by Black, Asian and Other Ethnic Minority entrepreneurs, as well as other under-represented groups when starting and scaling their businesses.
“This research will help inform the Commission on Race and Ethnic Disparities, which we hope will galvanise action across both the public and private sectors to address inequalities which lead to different business outcomes.”
Roianne Nedd, Global Head of Inclusion and Diversity at Oliver Wyman, said: “Entrepreneurship is a career where foresight, innovation, and tenacity should be key components of success in the UK, but our research shows that sadly this is not always the case.
“What should be a level playing field is littered with obstacles, many of which are products of a complex system of racial and gender disadvantage, underpinned by the pervasive impact of wealth and location.
“Let’s open our networks to entrepreneurs who are different from us. Let’s design financial products that reach people most in need. Let’s take a more thoughtful approach to selecting diverse suppliers. And let’s build support programmes that equip the under-represented with the practical tools necessary to transform their businesses from surviving to thriving.”
The post Bank reveals challenges facing ethnic minority business owners appeared first on SME Magazine.
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