I was looking at a story involving old TV shows. One of the shows mentioned was a Flintstones episode in which the women, Betty and Wilma, wanted to open their own business, but their husbands, Fred and Barney, worked to sabotage that business so that their wives would have to continue to serve them. That was not a controversial episode when it came out in the 1960s because, back then, women were not even supposed to work. Society had deemed their value was only as wives. That was then. Now there are a number of advantages to forming and working in a women-owned business, particularly if you are a woman.
And from a customer perspective, we often find that, because women had to work harder to gain their skills fighting through a male-dominated workforce, women-owned and staffed businesses can outperform their male-run counterparts.
Let’s explore some of the advantages that women-owned businesses enjoy.
There are around 12 million women-owned businesses in play today, and these companies together make an impressive $1.8T a year. While rare at one time, today, women-owned businesses represent 39 percent of all privately held companies. These businesses contribute significantly to the U.S. economy by employing more than 9M people. It’s interesting to note that in the tech field in which I operate, companies run by women have a return on investment (ROI) of around 35 percent higher than average.
Women-owned businesses are an important and increasingly powerful block of companies driving diverse change into a variety of industries.
No Glass Ceiling
One of the biggest problems for women in business is the glass ceiling. Male-owned businesses will hire women but do not really want women in management or especially in executive positions. Typically, women-owned businesses do not have that problem. They allow women to advance on merit just like their male peers, and this could have significant advantages when it comes to career advancement.
All firms are still being driven toward higher diversity, and one of the textbook ways to overcome a stalled career is to leave and then return at a higher level. If a woman’s progress is stalled in a male-dominated company, she might find a way around that obstacle by leaving to work for a women-owned company, advancing and then applying for an advanced job at the male-dominated firm. This strategy applies to both men and women, but women should find advancing easier in a woman-owned firm.
The Small Business Association (SBA) has a number of programs for qualified women-owned businesses that are designed to provide those businesses with advantages to offset the disadvantage of having to break into industries that are male-dominated. These incentives can provide unique contracts, business opportunities and other benefits to women-owned businesses which can help level the playing field and make running a women-owned business far more lucrative and successful than it once was.
One of the programs benefitting women-owned businesses is the WOSB (Women-Owned Small Business) Federal Contracting program that pushes five percent of the opportunities to minority- and women-owned businesses. There are a number of diversity programs that favor women-owned suppliers (like at companies like AT&T and UPS) that provide focused opportunities for businesses owned by women.
Be aware that many of these programs require the women-owned business be certified as such before the opportunities are made available, so if you are a women-owned business, consider getting certified so that these benefits can be made available to you.
Wrapping Up: Working with Women-Owned Businesses
If you are a woman, working in a women-owned business has a number of advantages, some of which I have highlighted above. But hiring a women-owned business is beneficial, as well. There are tax incentives tied to diversity and, according to a recent study by Harvard, working with a women-owned business can unlock innovation and drive market growth. And a study by the Peterson Institute for International Economics across 91 countries and multiple industries indicates that if there is at least 30 percent of women in leadership positions, the firm will gain a 6 percent next margin benefit.
In the end, forming, working for and hiring women-owned businesses can have lasting benefits that range from better career options to a healthier bottom line. Women-owned businesses may not have been that strong in our past, but our future will increasingly depend on the innovation, diversity and opportunities that these businesses will provide our industries and our wives, sisters and daughters as the world adjusts to a better, more diverse tomorrow.