Women-Owned Businesses Key to Economic Growth
Unprecedented success for women business owners reflects atypical philosophies, strengths, and challenges
Much has changed since my son was born in 1986, but few developments during the past two decades offer as great a “then and now” contrast as this fact: Less than twenty years ago, a bank could legally refuse to make a business loan to a woman entrepreneur unless a man co-signed the paperwork.
It was not until 1988, when Congress passed the Women’s Business Ownership Act (WBOA), that such discriminatory lending practices were outlawed. The WBOA (a) directed the Small Business Administration to provide funding for financial, management and marketing assistance programs for women-owned or -controlled start-up companies and established businesses; (b) established the National Women’s Business Council to review the status of women-owned businesses and to develop detailed multi-year plans for private- and public-sector assistance and promotion for such businesses; and (c) directed the Bureau of Labor Statistics and the Bureau of the Census to keep statistics on women-owned businesses.
Women entrepreneurs also benefited from such legislation as the Women’s Business Development Act of 1991 (which, in part, reauthorized the WBOA) and the Women Business Center Sustainability Act of 1999.
Those laws and, more important, the ambition and entrepreneurial spirit of American women, have sparked explosive growth in the number and stature of women-owned businesses. In recent years, that growth has accounted for a significant portion of the overall expansion of the U.S. economy.
Arizona exemplifies this welcome phenomenon. According to a study by the Center for Women’s Business Research (“Women-Owned Businesses in 2004: Trends in the Top 50 Metropolitan Areas”), from 1997 to 2004:
- the number of Phoenix-area companies in which a woman is the majority or sole owner has increased by more than 30%;
- employment by such businesses grew by more than 49%; and
- sales increased by a whopping 79%.
The Center estimates that the 136,845 women-owned businesses (54.7 % of all privately owned Phoenix-area companies) generate $41 billion in sales and employ more than 304,400 people. Those businesses encompass all industries, with the fastest growth seen in construction, transportation, communications, and agricultural services.
It is reported that women launch 424 new enterprises every day, more than twice the rate of start-ups by men. That disparity is attributable in part to the fact that women are better educated and more experienced than at any time in our history. In addition, women are more likely to receive training in larger companies and then leave to start a business, spurred not only by the quest for greater wealth but also, in many cases, by the desire for more flexibility in hours, more opportunities for personal growth, and better relationships.
More than ever, women are relying on other women to build relationships, to network, and to assist each other in achieving business growth. When compared to business owners as a whole, successful business women are often more eager to mentor and assist new women business entrants into the marketplace. It is common for women business owners to work together, formally or informally, to create a collegial and cooperative atmosphere of assistance that results in a mutually beneficial and rewarding business experience.
Business approaches and management styles tender to differ dramatically along gender lines. While neither gender’s approach or style is clearly superior to that of the other, one can generalize that, in business, women:
- tend to emphasize relationship building and fact gathering,
- are more likely to consult with others (including experts, employees and fellow business owners), and
- may take more time to make major decisions.
For those and other reasons, many women feel more comfortable being advised and guided by other women.
WHO’S IN YOUR CORNER?
Recognizing the importance of consulting with like-minded advisors in achieving your business and personal goals, Sacks Tierney has historically been comprised of a higher percentage of women business attorneys than most Arizona law firms of its size or larger. Further, we are the state’s largest independent law firm led by a women managing partner.
We are committed to the success of all of our clients, and we strive for excellence in providing the legal services sought by business owners of either gender. We are especially proud of our experience in helping women address their business challenges and to capitalize on their inherent strengths in starting and operating a successful company.