Women are flocking to business ownership in massive numbers. In fact, they are starting businesses at twice the rate of their male counterparts. However, most women-owned firms remain relatively small.
In 2007, I wrote The Girls’ Guide to Building a Million Dollar Business because, at the time, fewer than three percent of women-owned firms grossed over $1 million in annual revenue. Having built a million-dollar company myself, I was alarmed by this statistic. I wanted to do something to change this scenario. Unfortunately, nearly 10 years later, the needle has barely moved.
Why is there such a dismal picture for growth in women-owned firms? It’s certainly not because they aren’t talented, passionate or capable. Quite the contrary. Women business owners are some of the most hard-working and exceptional people I know. There is no singular explanation for why their businesses remain small, however, in part, it may be due to the types of businesses women typically start. In the corporate world, women tend to go into the softer disciplines such as marketing and human resources which typically don’t lead to the CEO position. Similarly, the majority of women start businesses in the service related fields which are more difficult to grow into the millions.
However, there is a bright spot for women in business. According to data from the Census Bureau, the number of women-owned firms grossing $10 million plus is growing like gangbusters — 56.6 percent since 2002 — fully 47 percent higher than the 38.4 percent increase among all $10 million and higher firms regardless of gender. A closer look at the types of businesses in this elite category reveals what some might consider non-traditional for women.
Take my friend Rebecca Congleton Boenigk. In 1989, she and her mother began manufacturing and distributing her dad’s concept for a Neutral Posture chair. The duo started the company in Rebecca’s garage and there was nothing glamorous about it. They took turns taking orders, and they worked together to assemble the chairs and ship them out. When the neighbors complained, they moved into what she describes as “a terrible old building” and they kept growing.
They stayed focused on building the business, but breaking into this non-traditional business had its challenges. “There are only three women owned furniture manufacturers in the U.S. It has been especially hard as the industry’s typical distribution is controlled by the five large companies that make up 80 percent of the market share,” Boenigk explains. Neutral Posture is now the No. 6 supplier of seating to the U.S. government, and it has sales reps and dealers all over the U.S., Canada, Puerto Rico, Panama and Dubai.
Susan St. Germain is the owner of TransProject LLC — a company that provides complete project transportation and logistics management to support construction projects in industries such as energy and airports. In the early days, she says the hardest part was learning how to present herself: “I saw other women come into the industry and try different techniques, but they never lasted. I have always been drawn to education and I truly believe that doing my homework and knowing what I was talking about gave me the platform to claim my place.”
St. Germain also believes women are tested in different ways than men. “We have to prove ourselves as traditionally men do not take our ability to get the job done at face value, especially in non-traditional roles.”
In St. Germain’s opinion, women need to take a hard look at what is holding them back from building successful enterprises. “If it is cash flow, I would say that there are various micro-lenders such as LiftFund (non-profit) that will roll up their sleeves and work with you to create a plan to grow your business. If your product is not appealing to as broad an audience as you believe it should, look at your product. Ask yourself honestly how you can improve it so that it will have broader appeal. Is it the economy? Is your product more a luxury than a necessity and do folks just not have the disposable income to purchase? If it is none of these, I would suggest taking a look inside and seeing if you are creating your own barriers,” she notes.
After starting her IT staffing company, ASAP Solutions Group, in 1989, Roz Alford grew the company to $90 million in revenue before selling the business in April of 2016. The first few years were extremely difficult, in part, because there were very few women in the industry. However, by 1998 the company was grossing $11 million in revenue. Alford attributes part of her success to a strategic decision she made regarding her customer base.
“I had made a decision that I would only work with Fortune 100 companies. The fact that I was a female really didn’t play a role. I believe because I was knowledgeable, credible and could deliver there were no issues,” Alford shared. Plus, she says, she always hired people who knew more than she.
Finally, all these wildly successful entrepreneurs agree that you must be persistent, passionate and love what you do in order to succeed. There is no guarantee of success, but hard work, determination, and a strong team are definite assets when it comes to growing your business.
