What Minority Business Owners Need to Know for 2025
The termination of federal diversity, equity, and inclusion (DEI) programs marks a pivotal shift in the landscape for minority-owned businesses across America. As Shavon Smith, a prominent business lawyer and author of the book “Tell Me About the Hard Part: Five Steps to Help Businesses Face, Solve & Prevent Problems,” explains, this isn’t just another policy change—it represents a fundamental restructuring of opportunities that have supported minority entrepreneurs for decades.
“This has been part of our lexicon as a country for quite some time, but more importantly, for the better part of four decades, part of the economy and underpinning the economy and really strengthening and bolstering minority businesses,” Smith explains, highlighting the deep-rooted impact of these programs.
The Corporate Exodus: A Domino Effect
The tremors from this federal decision are already reverberating through corporate America. Major companies like Walmart, McDonald’s, Meta, and Amazon have begun scaling back or removing their DEI initiatives altogether, creating a cascade effect across industries.
“Corporations, one, they answer to shareholders,” Smith notes. “So, the public pressure definitely means a lot for a corporation and they’re going to be swayed by that, but also swayed by the decision of their shareholders as well.”
Yet beneath the headlines, Smith reveals a more nuanced reality. “What you may see in a lot of corporations is the headline saying, ‘We are re-imagining or ending their DEI programs,’” she shares. “Some of these may exist in a different format. Maybe they’re corporate responsibility. Maybe they’re termed differently. But some of these functions in corporate America may still exist. We just may not call them the same thing.”
The Marketing Evolution
The impact on marketing strategies could be particularly significant. Smith, drawing from her the examples of Detroit automakers, offers a compelling perspective: “I think about General Motors and all these car companies will have these marketing campaigns geared with people that look like me—black and brown people. And I think as we start to have this pendulum swing, maybe companies will start to pull back on some of who appears in their marketing ads.”
The implications extend beyond representation: “Sometimes they’re hiring diverse companies to do that work to sell to diverse populations. So, I think our ads may start to look a little different.”
Survival Strategies: The Multi-Door Approach
For businesses navigating this shifting landscape, Smith advocates for a comprehensive approach. “You want to make sure you are in front of your customers,” she emphasizes. “You want to make sure they fully understand your value. You want to be in front of as many people in the company as possible, not just the supplier diversity [person], the supplier, the people who are ordering in general from the business.”
She identifies a common limitation facing many enterprises: “Sometimes a lot of businesses, especially small businesses, have a large customer and they’re buying a thing from you and they only know you to do that one thing.” The solution? “This is a great opportunity to make sure people understand everything that you do and everything that they can be buying from you as a business owner.”
Beyond Federal Contracts: New Opportunities
Despite the federal pullback, Smith points to alternative avenues for growth. “There are states who still have very strong supplier diversity programs,” she notes. “If you are selling something to the federal government, certainly you can probably find states across the country who are interested in what you are selling.”
Strategy for Long-Term Success
Smith emphasizes the importance of strategic positioning and political awareness. “To be a business owner, one, it’s a reminder of how much politics and business go hand-in-hand,” she reflects. “You can’t put your head in the sand about policy things that are happening because they certainly affect your business.”
Her advice focuses on adaptability and strength: “You want to make sure your business is on a strong foundation. You want to make sure you’ve always thought about diversifying your client base and finding quick ways to pivot.” As she concludes, “Being strategic and nimble are important in this moment, but they’re important in every moment for a business.”
Are you navigating these changes in your minority or women-owned business? Connect with Shavon Smith at thesjslawfirm.com or find her on LinkedIn for expert guidance on adapting your business strategy for success in 2025 and beyond.
