Almost weekly, talk shows showcase stories of ordinary women who had an idea that they marketed into million or multi-million dollar business ventures. According to USA Today, one of every 11 U.S. women is now a business owner. The Center for Women’s Business Research reports that of the USA’s 20 million companies, 10.1 million are owned by women. Female-owned companies employ more than 18 million workers.
In the past, the idea of a female owned business was a tiny, home-based operation with few employees. However, female-owned firms had an increase in revenue of 32% since 1997, to more than 2.3 trillion. This opens new sales opportunities for companies such as Pitney Boles and Wells Fargo.
Myra Hart, a professor of Harvard Business School believes many women begin their own company because they believe advancement among most major corporations for women may be limited. Women want more control over their career options.
According to the US Census Bureau, female owned businesses exceed male owned businesses in the services trade, retail, and unclassified businesses. Males still dominate the fire, construction, wholesale, manufacturing and agricultural sectors.
Maxine Clark, founder of Build-A-Bear turned her retail idea into a multi-million dollar industry. After 30+ years in the retail industry, she knew a successful idea that appealed to children as well as adults. Opening her first Build-A-Bear in the Saint Louis Galleria, she has expanded to have over 170 stores worldwide. She began her career as an executive trainee at May Department Store and now is listed as one of the “30 Most Powerful People in Discount Store Retailing.”
In 2003, the Journal of Small Business Management stated that “the research indeed indicated that female-controlled businesses, overall, had a higher failure rate than male-controlled businesses. Although this difference was statistically significant, it was not dramatic. The research also found that women tend to be over-represented in industries with high failure rates. Finally, the research discovered that when industry effect is taken into account the failure rates between male- and female-controlled businesses is not significantly different.”
In the past, women were more likey to fail at securing capital for a new business idea, but as more businesses flourish, funds are opening up for female entrepreneurs. Kathy Shepard, owner of Simply Math Tutoring in Alabama was a former teacher who used her expertise in mathematics to found a successful business venture. “Being female doesn’t have to close any doors. If I had one door closed to me, I continued to look for another. I knew I had a good idea.” She was right. Her business has grown from two to fourteen employees in the first year, and she has repaid business loans and even has shown a profit.
She credits her success to knowing the market, having a successful business plan, and having the drive and determination to see it through.
As the trend continues to favor women-owned businesses, the growth in the number of US businesses is expected to increase at an even larger percentage in the coming years.