How to support women-owned businesses
As Women’s History Month kicks off in March, here are 10 ways to support businesses owned by women.
March is Women’s History Month and March 8 is recognized as International Women’s Day, but the impact of women can be felt in the business world every day of the year.
According to the National Association of Women Business Owners (NAWBO), more than 11.6 million firms are owned by women in the U.S., employing nearly 9 million people, and generating $1.7 trillion in sales as of 2017. Women-owned firms (51% or more) account for 39% of all privately held firms and contribute 8% of employment and 4.2% of revenues.
Additionally, 5.4 million firms are majority-owned by women of color in the U.S. These firms employ 2.1 million people and generate $361 billion in revenues annually. And one in five firms with revenue of $1 million or more is woman-owned; 4.2% of all women-owned firms have revenues of $1 million or more.
Women have also been disproportionately impacted during the COVID-19 pandemic. Millions left the workforce to assume child care responsibilities. Those unable to quit were left to balance the pressures of both work and family. As we kick off March, here are 10 ways to better support women-owned businesses, courtesy of Jen Earle, NAWBO national CEO.
1. Provide better access to capital
“We need to examine our system’s structures to ensure all women business owners are included in traditional avenues to access working capital and funding,” says Earle. “Whether this means venture capital, banking, or government-run programs such as the Paycheck Protection Program (PPP), more needs to be done to level the capital playing field. Further, more education is needed about alternative sources of funding available to businesses, including fintech challengers, as well as grant programs that focus specifically on underserved groups.”
2. Embrace the digital economy
“We know that since the pandemic started, the importance of having a digital presence has increased significantly, as e-commerce trends have accelerated rapidly for consumers and businesses alike,” Earle states. “In fact, according to a recent study by Facebook conducted by Deloitte, 84% of business owners started using or increased their use of digital tools since the outbreak of coronavirus.
“Successfully navigating the digital economy will be essential for long-term small business success, and we need lawmakers and the Small Business Administration (SBA) to empower business owners with the resources they need to build their businesses online.
“In short, businesses need access to digital tools to have a fighting chance in the 21st-century economy.”
3. Understand the modern woman worker
“To support women-owned small businesses, it’s imperative that we understand the modern woman worker,” notes Earle. “This means considering how to preserve flexibility and challenging preconceived norms about how businesses should operate, making room for today’s female entrepreneur who wears many hats and balances many responsibilities — both personally and professionally.”
4. Lead with empathy
“According to the National Women’s Law Center, the women’s labor force participation hit a record 33-year low in January 2021,” says Earle. “In addition, recent studies have found that women are leaving work or reducing their hours at a much higher rate than men due to child care needs. As Facebook’s recent research found, family responsibilities were a prevalent reason for female employees leaving the workforce: 20% stated that caring for children or children’s education at home was the main reason they could not work, compared to just 3% for male employees.
“For female-owned businesses to succeed, companies and business owners must be empathetic with their employees, especially during this unusual time. Understanding the demands of ad hoc personal crises as well as caregiving is paramount to fueling the success of women-owned businesses.”
5. Support women-owned businesses by allowing for grace
“The best thing any female entrepreneur can do is to give herself some grace,” Earle explains. “Though we may try, we can’t always do it all. Prioritizing mental health and establishing boundaries is key to avoiding burnout and achieving long-term prosperity. We need to normalize advocating for ourselves and recognize that we all need time to relax and recharge with loved ones.”
6. Know the resources that are available, including the tax code
“According to [NAWBO’s] recent report with Gusto, 27% of women business owners reported that they had claimed tax credits under the Families First Coronavirus Response Act (FFCRA),” notes Earle. “And while 54% who did not use these credits said it was because ‘no employee needed COVID sick leave,’ one-fifth of owners did not because they were unfamiliar with or unaware of this program.
“This is just one example of how important it is for business owners to be aware of the resources at their disposal, including those through the SBA and the tax code. We need to continue to educate businesses on using all the tax credits available, allowing them to take full advantage of the programs designed to assist them.”
7. Talk to lawmakers about the definition of small business
“Some small businesses may be a sole proprietorship, some may have a handful of employees, and some may have a few hundred,” says Earle. “The challenges faced by small businesses of various sizes differs significantly. That said, prioritizing the smallest of small businesses is extremely important as these are often the ones most often left out — as we saw during the first round of PPP.
“Engaging in thoughtful conversations with lawmakers about the definition of a small business and the varying needs of them will help move the needle in this regard.”
8. Offer succession and retirement education
“Even during difficult times, it’s essential to plan for the future,” advises Earle. “I always tell business owners it’s just as important to be prepared to exit the workforce as it is to enter it. Understanding this, I advise business owners to think ahead and educate themselves on succession planning and retirement. This is particularly important if, through your small business, you don’t have traditional retirement saving plans established, such as a 401(k).”
9. Build a network to help support women-owned businesses
“It’s super important — particularly for women business owners — to build a network and find sponsors, mentors, and partners along their entrepreneurship journey,” Earle notes. “Luckily, now more than ever, these resources are available online. For instance, Tay Watts, founder of Posh Candle Co., created a ‘Boss Lady’ candle, and after sharing about it in a Facebook Group, she received her first bulk order of 5,000 candles, helping to jump-start her fledgling business.
“Another example is that of Mary Van Doorn, who founded Sugar Mama Strong, a fitness and lifestyle coaching service for women with diabetes, after she couldn’t find a support group to get her through her diagnosis. Sugar Mama Strong is a women-only Facebook Group of now more than 5,000 members and aims to take the shame out of diabetes diagnoses and encourage women to feel empowered to lead a healthful lifestyle.”
10. Keep an open mind
“Being nimble and willing to adapt, to reimagine the future, is so important for women business owners,” says Earle. “To build prosperous businesses, and by extension a prosperous economy, we must recognize the importance of using online tools and supporting one another. This is only possible by being willing to adapt to new circumstances, as we saw during COVID-19.
“One of the biggest advantages small businesses possess is their ability to be agile. By keeping an open mind and willingness to explore new opportunities and pivot, female business owners can position themselves for success no matter what the future holds.”
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