The growth in the number of women-owned businesses continues its upward trajectory, contributing economic vitality and increased employment opportunities to our nation's economy.
And recognizing the importance of this niche in the small business market, Region's Bank has begun studying how to best serve these business owners. "We look at women-owned businesses as a significant, viable small businesses force in our country, and we're trying to find a way to empower them and serve them in a way that they are not getting today," says Lynetta Tipton Steed, executive vice president and division head for business and community banking. Tipton Steed has played a role in ongoing focus groups and market studies to identify the particular needs of women-owned small businesses on their path to achieving success.
"We're not just here for financial solutions, we're also here to help women network and find resources," she says.
What role do women-owned businesses play in the small business sector?
Women play a very important role in the small business sector and in the future of small business in our country. There are 8.4 million women-owned businesses in the U.S., and those with paid employees employ almost 8 million people, making them critical to employment growth. Out of those 8.4 million women-owned businesses, only about 250,000 have revenue in excess of $1 million, so clearly, the vast majority of women-owned businesses are classified as small business.
How and why has the women-owned business niche evolved in recent years?
The women-owned niche has grown at 1.5 times the national average since 1997. Much of this growth is attributed to necessity, as more women, in recent decades, have become the sole provider for their children. Many women have also started businesses during the recession, as their spouses have lost jobs and they've had to become the breadwinner for the family.
On a larger scale, there are many incentives for women business owners to obtain government contracts, and large corporations have increased their attention on supplier diversity.
How are women managing the dual roles of creating and running businesses while also raising families?
It is much more acceptable today for women to maintain high-profile positions in both small and large companies while still maintaining a work/life balance. The successful women business owners in our focus groups all had families. In fact, the reason they went into business is because of and for their families, to leave a legacy and to be able to be flexible with how they work and how they take care of their families at home.
How do the increased numbers of women in executive and leadership positions benefit the business space?
It encourages diversity for future generations. If you are only asking one group of people - men - you're going to tend to get stalemated in how you view opportunities. So diversity of any kind is good, and we're really trying to bring in all perspectives.
Women tend to have different perspectives on work/life balance than men. They are typically the primary caregivers for their children, as well as for aging parents. They also tend to focus more on the big picture, not just on making money, and on hiring a more diverse talent pool in light of their own business struggles.
What are some of the biggest financial mistakes female business owners make with their businesses?
Research shows that women are much less likely to use commercial credit than men and that they typically do not grow their businesses as quickly as men do. One of many reasons is their view on the willingness of banks to loan them money. It's a misconception about the role that banks can play, not just for women-owned, but for small business in general. Women should not be afraid to approach banks to help them gain access to capital to assist with growing their business.
