Women and Small Businesses
In the past, men dominated in many businesses and women were regarded as inferior in most countries thus denying them chance to participate in entrepreneurship (Naidoo & Patel, 2009). In addition, people did not trust that women would manage to start-up business and thrive. However, with the introduction of women development centers that empowered women, the growth of women dominated small business started (Chadwick, 2013). In addition, the introduction of grants and loans to support small businesses owned by women have contributed to growth over the years. From year 1997 to 2013, women-owned small business grew by 59%, which translated to the rate of 1.5 times of the United States businesses (WBO Statistics, 2014). Currently, the businesses owned by women stand at 9.1 million firms, which employs more than 7.9 million people and generate sales of approximately $ 1.4 trillion every financial year (WBO Statistics, 2014). This shows high growth rate compared to other businesses owned by other genders. In this paper, evaluation of women owned businesses and their impact on the economy would be evaluated.
Startup of women owned businesses
In the past, it was hard for women to start their own business, but with the introduction of finances inclined to women and legislations that encourage women entrepreneurs, the businesses have improved tremendously over the years. In order for women to start a new business, they need to balance between their families financial and business capital. This has been challenging to a number of women and it has affected the growth of women-owned businesses. However, with the introduction of small business loans and other grants, women have managed to secure loans, which they have used to finance their businesses. Women have groups and organizations that give them loans to start businesses such as women-owned business office, (OWBO) and administration for small businesses, (SBA) which advices and provide loans to women who want to start or develop their businesses (Women-Owned Businesses, n.d.).
Types of women-owned businesses
Since women have both entrepreneurial support and capital in forms of loans to start and grow their business, they have ventured in different industries such as healthcare, education, waste management, art, retail, entertainment, security, and recreations (Chadwick, 2013). The diversity of industries ventured by women have increased their opportunities and increased their performance since one starts a business in the most appropriate industry. This has been evidenced by various data published by the council of women, (NWBC) where education sector has been the most women-dominated industry representing 45.9% of the total businesses owned by women (WBO Statistics, 2014). Waste management represents 37.0%, while retail, art, recreation, and entertainment represents 34.4% and 30.4% respectively (WBO Statistics, 2014). However, industries like transport and construction in addition to mining have the least numbers of women operating them.
Figure SEQ Figure * ARABIC 1: Type of women-owned businesses (Industry Canada, 2013).Women-Small businesses and Economic growthWomen businesses have continued to experience increased growth over the years. In most states of US, women have been said to contribute significantly to economic growth of the country. The industries operated by women employ more than 7.9 million employees, which is 14% of the total employments across various industries in the country’s economy. This has helped the country to realize one of the most important economic growth pillars to create employment to common citizens. In addition, the industries have helped to improve the living standards of people across the states and areas where they operate since they offer attractive wages and allowances. In addition, the sector has been said to generate sales of $ 1.4 trillion in every financial year, which translate to revenue of 11% that is directed to the government (WBO Statistics, 2014). This has helped the government to fund its projects and run its institutions smoothly, thus providing quality services to citizens. Increased development of government projects such as infrastructures have played important goals in development of the country’s economy.
Success of women-owned small businesses
Success of these business have been associated with business friendly legislations, decreased cost of starting businesses, reduced promotional costs, and used of technologies. United States and other countries in the world have enacted legislations such as Act III of 2007 that empower women to start their own businesses (Arora, 2014). For example, legislations have reduced requirements for accessing loans in government affiliated financial institutions and has led to establishment of organizations that educated women and give them grants for starting businesses. In addition, introduction of technologies such as laptop, internet and computers has helped women to market their businesses and reduced cost thus increasing the returns on capital. The technologies have been used for promotional purposes and marketing, which has helped to deal with competition in the market. As a result, businesses in the market have continued to grow and expand across the world. For example, small businesses that are owned by women have grown by 59% between 1997 and 2013 with the current standing of about 8 million businesses have women ownership (WBO Statistics, 2014).
Challenges experienced by women in small businessesAlthough many women have gone against the odds by starting their own businesses and succeeding, they continue to experience challenges that limit their operations in small businesses. One of the challenges is self-limiting thoughts where women are afraid of succeeding to the top due to social situations that they have experienced while growing up in the society. Major have been abused, oppressed, and denied opportunities to participate in socioeconomic activities in the community due to their gender. Such women when they become successful, they tend to limit their success in order not to go against the society beliefs (Brooks, 2014). Success of women can only be realized if they ignore such beliefs. Moreover, they continue to face resistance from their family members and especially husbands and other males in the families (Brooks, 2014). This has affected many women negatively to the point of leaving their businesses or never starting one, which has negative impact on the growth of small businesses owned by women.
Although men dominated businesses in the past, women have changed the culture by starting small businesses, which have experienced high economic growth over the years. This has been evidenced by increased number of employees that the sector continues to employ and increased sales. The success of the business can be linked to enactment of legislation empowering women, presence of grants and loans, and availability of cheap method of promotions that have enhanced their competition in the market. The economic growth has been associated also to the ability of women to venture in different industries such as education, retail, arts, waste management, recreational and entertainment.
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Brooks, S. (2014). 5 Key Challenges Facing Entrepreneurial Women. Small business. retrieved on 23 Nov. 2014 from http://www.smallbusinesscan.com/5-key-challenges-facing-entrepreneurial-women/
Chadwick, N. (2013). Championing trade support for women entrepreneurs. International Trade Forum, (4), 1-2.
Industry Canada. (2013). Key Small Business Statistics: How many small business entrepreneurs are women? Government of Canada. retrieved on 23 Nov. 2014 from http://www.ic.gc.ca/eic/site/061.nsf/eng/02815.html
Naidoo, K., & Patel F. (2009). Working women: Stories of strife. India: SAGE Publications
WBO Statistics. (2014). National association of women business owners, (NAWBO). retrieved on 23 Nov. 2014 from http://nawbo.org/section_103.cfm