List Shows Decline, but Black Firms Grow

The aggregate value of Black Enterprise magazine’s listing of the top black-owned businesses fell last year for the first time, from 1996’s record high of $14.1 billion to $13.19 billion in 1997.

That’s because TLC Beatrice International Holdings Inc., far and away the No. 1 entrant on the list, sold part of itself off and its sales fell from $2.23 billion in 1996 to $1.4 billion in 1997.

Although that was the first fall-off since Black Enterprise combined its BE Industrial/Service 100 with the BE Auto Dealer 100 in 1988, the bottom 99 last year exceded 1996’s bottom 99 in total sales.

“What you are seeing is not a loss in black business. There’s been a growth in black business,” said Earl “Butch” Graves Jr., president and chief executive of Black Enterprise magazine, noting that the American economy is on a tear. “If you’re not making money now in business, you really should be thinking if you should be in business.”

Black Enterprise spent the last week assessing the recent past, leading entrepreneurs in seminars designed to help them grow at its third annual convention in Orlando.

Concurrently, BE led the CEOs in strategic planning designed to maximize what they have through estate and succession planning and acquisitions and mergers. Earl Graves Sr., chairman, editor and publisher, has been pushing his fellow CEOs to think in bigger terms.

“A lot of times we are hampered . . . because we are not large enough to compete,” said Graves Jr., one of the seminar-leading BE 100 heirs who noted that newcomers to the BE 100 lists got there by acquiring competitors.

Alfred A. Edmond Jr., a BE vice president and executive editor of the magazine, said when the Citicorp-Travelers and Chrysler-Daimler-Benz mergers are examined, it becomes “obvious they are not doing it for the fun of it.”

“They want the size and breadth of technology and services in order to compete on a global level. All black-owned companies shouldn’t do that but some black-owned companies must do that,” Edmond said.

“What you are really looking at the BE 100s for the next five to 10 years is a list in transition,” where succession, global activity and taking advantage of economies of scale through mergers and acquisitions will rule the day, he said. “It’s going to be very interesting to watch.”