I am one of the many self-employed people working in the United States. But, what is significant to note is that I am a woman.
During the last 20 years, the number of self-employed women has gone up dramatically according to the US Census Bureau. Of course, that is to be somewhat expected as the population rises.
But this increase has more impact when it’s also known that the percentage of businesses owned by women has also markedly increased. Let’s explore why women owned businesses are on the rise.
Women Recognize Openings in the Market
The typical female is the main shopper in any household. Whether she is a wife, mother, or single, woman she makes most of the purchases.
Women entrepreneurs and business owners are using this as an advantage. They recognize openings for new products and services in the marketplace. When they see these gaps, women try to fill them due to their natural tendency to be problem solvers.
Almost before they know it, they have opened a new business simply because they understand market trends, gaps, and weaknesses.
Women Owned Businesses Start-up Costs are Lower
Obviously, technology has changed and improved over the last couple of decades. Women, as well as everyone else, now have access to many electronic devices that they didn’t before.
These upgrades provide the opportunity to conduct business instantly using affordable and mobile devices. Information can be stored on the cloud and retrieved with the touch of a few buttons.
Therefore, women can now open storefront businesses more easily and cheaply. Not only that, but they can run a business from home and care for their families at the same time, lowering overhead costs considerably.
In addition, social media and other advertising mediums make marketing costs lower than they used to be. As a result, paying for TV and radio promotions has almost become a thing of the past.
Technology has also sped up the length of time it takes to conduct business, further reducing costs.
All of these improvements make start-up costs lower and contribute to the increases seen in women owned business.
Access to Needed Capital Has Improved
Today, women who seek business funding have an easier time getting it. This is due, in part to the lower interest rates we are all currently experiencing on mortgages and loans.
But other influences likely include the fact that the principal of the loans is now less due to lower capital needs, as I mentioned earlier, and the lower interest rates. Therefore, the life of the loan may also be shortened.
The upshot is that banks are more willing to grant loan requests due to the lower risks involved. Thus, women entrepreneurs have the openings they need to start new businesses.
Banks and other lending institutions are not the only sources of capital a woman may use, though. They may also utilize start-up money received from family or friends.
However, no matter where a woman gets the needed capital to open her business, clearly access to needed capital has improved.
As you can see, women owned business are on the rise. What remains to be seen is whether or not this trend will continue in the future.