Women Owned Businesses are Growing at an Impressive Rate
Findings of The second annual State of Women-Owned Businesses Report, a study commissioned by American Express OPEN, indicated that the number of women-owned businesses in the country as of 2012 is estimated to be more than 8.3 million. These businesses generate revenues of nearly $1.3 trillion and employ a total of 7.7 million people. These numbers illustrate the significant growth of women-owned businesses in the past 15 years. Compared to 1997 figures, the number of women-owned businesses has gone up by 54% while employment and revenues increased by 9% and 58%, respectively. These growth rates are higher than the national average, in fact, these numbers exceed those of almost all privately-held businesses.
As expected, women-owned firms continue to dominate the health care and social assistance industries, accounting for over 50% of the firms in this industry. Incidentally, these are the industries with the highest concentration of women-owned businesses. Other industries with a high women-owned businesses concentration include educational services, administrative services, and waste services. However, a few women-owned businesses have gone into construction, transportation, finance, and insurance.
Five states were named as having the fastest growing number of women-owned businesses during the years of 1997 to 2012. Georgia came in first at 95%, followed by Nevada, North Carolina, Mississippi, and Texas at 92%, 83%, 75% and 75%, respectively. Taking into consideration other factors like revenues, and employment provided, states that are of most economic influence are DC, Wyoming, Nevada, Arizona, and North Dakota.
Women-owned Businesses and “The Heartbreak Hill”
While women-owned businesses seem to be faring very well, with impressive growth rates that show no signs of slowing down, the study further reveals that women-owned businesses have a problem maintaining similar growth rates above the million-dollar revenue mark, also known as the “Heartbreak Hill” of the entrepreneurial marathon. This may be an indication that women are disappearing from the ranks as their business grow larger by gaining additional owners or completely selling their stake.
The Turning Point
Susan Sobott, the president of OPEN, notes that there comes a time when women-owned businesses reach a turning point and how important it is to be proactive. She said that although these businesses are growing exceedingly, those that reach revenue marks of between $250,000 and $499,999 experience a defining point. In order to further advance and grow these businesses, new management tools must be implemented.”
Small business loans for women can provide additional working capital to women-owned businesses. Additional funding can be used for expansion, or as additional working capital. By providing small business loans for women it might very well allow women owned businesses to forgo the need for partnerships by offering them the ability to remain with the established companies and even grow. Small business loans for women, coupled with planning and additional business resources help take women-owned businesses even further.