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Woman-owned companies with employees out earn those with none

Posted in NEWS by msceonet on January 4, 2010

Woman-owned companies with employees earn six times more revenue than lone women entrepreneurs

Businesswomen free to follow their own path but hiring at the right time is key for growth experts say

By Felicia Joy
Senior Correspondent

Having employees to delegate to is apparently a boon to the bottom line in business. Some experts say it’s the reason many women-owned companies are still lagging in revenue compared to those owned by men. The majority of women entrepreneurs are going it alone according to findings by the Center for Women’s Business Research (CWBR), and this significantly impacts their ability to grow their brand’s notoriety, influence and profits.

(Read the full economic impact report by the Center for Women’s Business Research.)

CWBR’s data show that there are 1 million woman-owned companies with employees versus 7.1 million with none. Those with a workforce earn an average $802 billion per year collectively compared to $137 billion—or six times less—for the lone rangers. “That’s the multiplier effect,” said Gwen Martin, director of research and the interim director of the CWBR. “There’s only so much you can do by yourself. Through research, we’re able to prove to women and policymakers how important it is to move them from technical experts to business leaders of employer firms.”

“The biggest enemy to women in business is isolation.”

–Nell Merlino

Margaret Barton, executive director of the National Women’s Business Council, a bi-partisan non-profit organization created by Congress to advise the president on issues of importance to women entrepreneurs, says these figures are telling but that every woman in business defines her own success and significance, which may not include being an employer. “That’s one of the benefits of entrepreneurship. A woman can slow down or speed up her enterprise, say what goes and exert control over her destiny,” Barton said.

Martin, the research director at CWBR, agrees that some women may not want to become employers but she believes more of them would if they knew the difference it could make and if they were comfortable building their business to that point. “Some women will say they are not interested in growing to the point of hiring others but I think in many cases they say that because they’re not sure how to do it,” Martin said.

Nell Merlino, founder of the non-profit organization, Count Me In, and creator of the Make Mine a Million $ Business initiative for women, says there is still certain thinking, or lack of awareness—on the part of women—that is holding them back from building something bigger than themselves.

“The thing that challenges women the most in almost anything they do is the belief that they must do everything themselves, especially when it comes to their children,” Merlino said. “I may be going too far out on a limb here as someone who chose not to have children, but, women can get help with their families. Children need guided activities and the care of responsible people, it doesn’t always have to be their mother. I see women constantly struggling with guilt about their children, and that doesn’t have to be.” Merlino says women also limit their growth by trying too often to think through business problems on their own. “The biggest enemy to women in business is isolation,” she said.

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