According to report released by American Express, there are now over nine million women-owned businesses in the United States and women are opening businesses at an estimated rate of 1,200 new companies each day.
This is up from an average of 740 businesses last year, indicating that women are a growing force in the business world. However, statistics show that women-owned businesses often produce less revenue than male-owned businesses in the same industry.
In some cases, the women who own the business made simple mistakes that could have grown their company more quickly and increased their revenue tremendously.
Not Having a Solid Business Plan
Although not unique to women alone, entrepreneurs who do not create a solid business plan may struggle to succeed.
Women, especially, enter the business world with a “just do it” philosophy. They may be anxious to begin providing the goods or services they know are needed in their community. In some cases, they may be afraid to put the theory in writing because they may discover their dream isn’t really feasible.
The fact is, a business plan is a written road map used to guide not only business owners in the right direction, but staff that may be hired later. Many times, a business plan is required if the company needs to apply for funding, whether it is grants or small business loans.
Failing to create a solid, written business plan could spell disaster for a small business.
Funding can also be one of the biggest hurdles for aspiring minority business owners. To help with this issue, Bankrate created a guide that breaks down every option business owners have to raise capital. It also discusses how to start, and grow your business as a new business owner. You can view the guide here.
Thinking Like an Employee
When you open a business, you must stop viewing business matters as you did as an employee. As an employee, your focus is on the job you do each day.
A business owner not only has to focus on the day-to-day operations that produce goods and services, but also sending out invoices, stocking merchandise, replacing machinery necessary to perform duties and even getting garbage picked up on a regular basis.
When you think like an employee, you often set rates lower than you should, considering only the amount you need to meet your own obligations.
As an owner, you must consider taxes, insurance, retirement funds, equipment, supplies, advertising and a whole host of other overhead costs. As an owner, you also must think in the long-term, considering where you want your company to go in the future. Therefore, it is critical to stop thinking of yourself as an employee of your company and begin focusing on the items important to you as an owner.
Lack of Knowledge About Business Networking
Women and men have completely different methods when it comes to networking.
Men often view networking as a way to connect with other people and businesses who can benefit them either on a personal level or on a business level.
Women, on the other hand, tend to develop relationships and friendships before they ask for assistance.
When they do ask an acquaintance for assistance, even in a business setting, they usually offer their own assistance in exchange. Learning networking skills is one of the best ways for women to grow their business and improve their bottom line.
Lacking Confidence
Research released by the Global Entrepreneurship Monitor found that women feared failure by more than nine percentage points over men. One theory is that women start businesses with less startup funding than men, leading them to fear not only economic failure but social failure as well.
Some women feel as if their business demonstrates how far women have come in the business world and failure would be devastating not only to the woman who owns the business, but to women overall.
In addition, women who are confident, willing to take risks, innovative and curious are often looked down upon in society. This leads many women to take a more nurturing and empathetic role, even in their own business.
In order to succeed in a male-driven world, women must learn how to be more confident and sure of themselves, yet lack of confidence is a mistake many women make in business.
The most important thing for women to succeed in business is to take action steps to assure that they succeed. Develop a solid business plan, begin to view networking as a way to grow your business, be confident and think like an owner. These four simple steps can help you begin making better decisions related to your business and open up many more chances to succeed.
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