Women-Owned Businesses Are Growing Fastest in Non-Traditional Fields
Women-owned businesses in industries considered non-traditional--construction, agricultural services, transportation, public utilities, and communications--are growing much faster than those in fields where female business owners have traditionally clustered, such as services, retail trade, real estate, finance, and insurance, according to a new report from the Center for Women's Business Research, underwritten by Open from American Express and the PepsiCo Foundation.
For example, the number of construction firms owned by women grew 57% between 1997 and 2004; employment by these firms jumped 91%, and revenues increased 107%. By comparison, women-owned businesses in service industries, which make up the largest segment of women-owned firms, grew 17% in number, 57% in employment, and 66% in revenues.
The study compares women business owners in non-traditional fields with men in the same fields and with women in traditional fields. In some ways, women in non-traditional fields are more similar in their outlook to men in their fields than they are to women in traditional industries.
Female- and male-owned businesses in non-traditional industries are comparable in organization, revenues, and financial profiles. Firms owned by women and those owned by men are equally likely to have $1 million or more in revenues and to have employees. Both cite the need to upgrade or purchase new equipment as their most important driver for seeking outside capital.
Both female and male owners are currently using an average of 3.5 different sources of capital. Out of 13 sources examined, only three--business earnings, vendor credit, and commercial lines of credit--are less likely to be utilized by female owners than by male owners. The top source of capital among both male (92%) and female (81%) owners is business earnings.
On the other hand, female business owners in non-traditional industries are more likely than their female counterparts in traditional fields to use commercial sources of capital, particularly commercial bank loans and commercial lines of credit. Women in traditional industries are more likely than those in non-traditional ones to use personal credit cards, personal savings, and personal bank loans to finance business needs. …