Women-owned businesses: A niche market or vehicles for change?
If the United States is an indicator of global trends, women-owned businesses are a force to be reckoned with. According to the 2015 State of Women-Owned Businesses Report, women-owned businesses have increased 74 percent over the last 18 years and now account for 30 percent of all enterprises. Moreover, women-owned businesses have increased growth rates in number, employment, and revenues as compared to national averages in the U.S.
Specifically, between 2007 and 2016, the number of women-owned businesses increased by 45 percent, while the number of all businesses in the U.S. increased by 9 percent; employment in women-owned businesses increased by 18 percent, while employment among all businesses declined by 1 percent; and revenues of women-owned businesses increased by 35 percent, 8 percent higher than the revenues among all U.S. businesses.
Although there is a rise in the number of women-owned businesses in the U.S., they often remain micro and small enterprises, and have contributed about the same amount to the economy that they did in 1997.
It turned out to be a bigger business opportunity than I had imagined.
Thus, despite the fact that women-owned enterprises are increasing, women are clustered at the bottom of the pyramid, which means that the overall impact of women-owned businesses on the economy and society could be leveraged more. This is not only true for entrepreneurs. For instance, women are still under-represented in leadership positions, as fewer than 5 percent of the 1,000 largest companies in the U.S. have female CEOs.
In May, B.Accountability was certified by WEConnect International as a Women-Owned Business. As the CEO of B.Accountability, and with over 25 years of experience as both a business lawyer and public accountant, I was surprised when I was asked to certify my sustainability consulting company as a Women-Owned Business.
I knew B.Accountability provided quality services delivered by an amazing team that speaks for itself, leaving me to wonder what value the Women-Owned Business certification could add to my business platform. If anything, I was concerned B.Accountability would be perceived as a token women’s business, a label that may overshadow the qualitative services we provide. In spite of my initial hesitation, I saw it as a business opportunity and applied for the certification, and it turned out to be a bigger business opportunity than I had imagined.
I quickly realized the value of my Women-Owned Business certification. In June, I was invited to a session in Orlando where Iand 3,500 other executives and procurement representatives from leading corporations, government entities, and female business owners from a range of industries met to discuss business opportunities and the role women-owned businesses play in stimulating economic growth.
For instance, I met with representatives from IBM, Wal-Mart, PepsiCo, UPS, AMEX, pharmaceutical companies, banks and many great female CEOs. All the attendees who hailed from a variety of sectors had a common vision: to expand women’s business opportunities in the marketplace.
Previously, as a Partner at PwC, my experience with procurement negotiations involved competition and lengthy negotiations. However, in Orlando, the atmosphere was collegial and it was clear that while companies did want the best deal, they also took social impact into consideration.
In Orlando, I saw amazing support between both certified companies and the Fortune 500. I realized that more and more Fortune 500 companies want to support women-owned businesses because it makes business sense and that WEConnect International is actually connecting women-owned businesses to major industry leaders.
One might argue that women-owned businesses are a different kind of business — they offer an opportunity for new collaborations and partnerships — at least that is what I saw in Orlando and what I anticipate seeing when I speak at the Go for the Greens Business Development Conference in late September. These companies are serious and produce quality products and services and want to grow bigger, employ more diverse people and generate more revenue for our economies.
Another benefit is that having more highly qualified women owning their own businesses will create a bigger pool of women who are able to increase women’s representation on corporate boards, and hence diversity in the workplace. I truly believe in leveraging gender diversity to yield high financial — and human — returns, as I argued in an interview with Forbes last year.
I also believe that more women-owned businesses will lead to innovative new ideas and help advance the Sustainable Development Goals (SDGs) that we are all working towards. For instance, by increasing women’s access to markets and leadership opportunities, women-owned businesses can help advance SDG No. 5 Gender Equality, SDG No. 8 Good Jobs and Economic Growth and SDG No. 10 Reduced Inequalities. We have already seen the potential of women-owned businesses to make significant change and impact economic growth. Since 2015, women-owned businesses have generated about $1.5 trillion in revenues and employed over 7.9 million people.
Women-owned businesses truly are a vehicle for change — they are reaching new corners of the market by fostering new opportunities for entrepreneurs as well as the Fortune 500, and are helping advance the SDGs. Now, instead of worrying about B.Accountability being labeled as a niche business because of its Women-Owned Certification, I am eager to engage in the opportunities for partnerships that it allows — and am excited my company not only advances sustainable development with its services, but also with its leadership and contribution to broader system changes.
Having said all that, I do hope that we in the near future don’t have to talk about women- or men-owned businesses — but about successful business with a purpose and a diverse workforce from board level to assistant.