First Black-Owned Supermarket In San Diego Struggles to Survive

EVEN before he was a teenager, Leroy Brown was in the grocery business. He was hired by a small Chinese-owned grocery to stop his peers from shoplifting candy. ``I was the guy with the big mouth,'' he recalls. ``I was given an opportunity to do something right.''

Now, after almost three decades of full-time supermarket work, Mr. Brown is seeing the fulfillment of a long-standing dream: In March, he opened his own store. Located in a multi-ethnic, low-rise neighborhood, Brown's Town and Country Market is the city's first black-owned supermarket, according to the San Diego Union-Tribune.

The market, which just ended a two-week grand opening, is part of an increasingly successful segment of businesses in the United States: those owned by African-Americans. ``Coming On Strong'' is the headline in the June issue of Black Enterprise, which features the magazine's annual list of the top 100 industrial/service companies and top 100 automobile dealerships owned by blacks. These firms, in industries ranging from high-tech to food to beauty aids, surpassed $10 billion in annual sales in 1993 for the first time ever - a 13.9 percent increase over 1992. In 1992, these companies reported a 14.1 percent revenue growth over the previous year.

The progress is not limited to companies with millions of dollars in sales. A US Census Bureau study found a 38 percent rise in the number of black-owned companies, to 424,000, between 1982 and 1987. An updated study is expected soon.

``Entrepreneurship is in style'' among blacks, says Alfred Edmond, managing editor of Black Enterprise in New York.

Still, only about 3 percent of all businesses in the US are owned by blacks. The recent recession and restructuring in the economy hit some of them hard. Many weaker companies went under, but those that persevered have become leaner and more productive.

While minority set-asides in government contracts and community-based lending programs are important, Mr. Edmond says, the road to economic empowerment depends more on blacks gaining business know-how.

``Eighty percent of all American businesses operate without a business plan,'' he says ``This, not lack of capital, is one of the primary reasons why most small businesses fail within the first five years.''

Though Brown had little capital of his own, his industry knowledge and a class in entrepreneurship helped him win his own store. Last year, as the Fleming Company was liquidating 26 grocery stores for the Big Bear chain, Brown was on the lookout.

Though skeptical at first of whether the store could be profitable, ``the more I came and walked [in] it, the more I saw the potential,'' Brown says. He reasoned that by cutting prices and catering more to the rainbow of ethnicities in the area, the store could win business from other nearby supermarkets.

The Fleming Company found that Brown's business plan matched its own estimates and gave him a $500,000 loan to buy the store. Brown got a $175,000 loan from the Bank of Commerce for start-up expenses. That loan was guaranteed by a state-sponsored nonprofit organization, California Southern Small Business Development Corporation.

Fittingly, Brown says one of his first acts upon reopening was to kick out a few professional shoplifters he noticed during his previous visits. He proudly points to a beefed-up section of the store geared toward Asian customers, and a much expanded Jewish section. In another area, the Tampico brand of spices stocked by Big Bear is being replaced by a brand that Brown says Hispanic customers prefer.

Most of all, Brown is trying to make this a ``neighborhood store,'' where customers know him and tell him what they want.

Brown's background in the nitty-gritty of pricing, inventory, and staffing is as important as his vision. He figures the store must do sales of $95,000 a week to keep afloat but could do much better than that. So far, Brown has had to cut his staff, which includes his wife, Blanca, and five of his eight children, from 30 to 20 to get through lean times.

``I just squeaked through,'' Brown says. With the busy summer months ahead, he hopes those days are ending.