Do women owned businesses have higher failure rates?

Darlene Ziebell

Darlene Ziebell President Center for Women Business Owners

Recently in the online Nawbo Smartbrief, an article indicated that women owned businesses now make up 30 percent of American businesses.  While searching for statistics on the success rate of women owned businesses, I stumbled on an article in the Journal of Small Business Management.  The article relayed there are a number os potential systematic differences between male and female business owners that might explain why female owned businesses appear to underperform male-owned businesses.  Of those listed, 5 reasons are at the top of the list:

  1. Women owned businesses may be younger than male-owned
  2. Family commitments prevent female business owners from spending the time on their business
  3. Female business owners have less access to capital
  4. And female business owners may not have the same levels of education or experience
  5. Finally… female business owners may be less concerned with financial rewards than male owners

Having many years of entrepreneurial experience as a female business owner, these reasons intrigued me.  I remember being very young when I began my first business. There is not much one can do about the age of your business.  But the younger the business, the less experience the business owner has.  Family commitments is another issue women must face. How do we juggle it all?  Unfortunately, the more we take on the less time we have for our personal lives.  Something I was willing to accept in order to be a successful business owner.   The last three reasons are intertwined.  If women business owners are not driven by financial rewards, there is no burning desire to raise capital and strive to get the experience and education needed to grow a large successful business.   Only the business owner can review these reasons and must be honest with themselves as to what drives them to be a business owner.   In my opinion there are only 2 reasons why anyone wants to own a business:

  1. To be a financial success
  2. Or give yourself a job…

If you know the answer to this question, it will make it much easier to derive a strategy to overcome those 5 top reasons listed above to give yourself the opportunity to be a success.. and not one of the statistics in the failure rate.

Written by

Darlene Ziebell

Founder

Center for Women Business Owners

Comments

  1. I find that many female business owner’s have a hard time asking for help and saying no. Those two factors alone handicap their business. There is an amazing amout of personal self-growth that occurs during the course of owning a business and without seeking assistance through that process it becomes easier to give up.

    Great article Darlene!

  2. HI Nora… thanks so much for the review.

    I agree with you … women business owners have a very difficult time saying “no”. One of our webcast guest speakers.. Rick Lochner.. gave a presentation on women business owner leadership. When we asked him what is the number one area women business owners should focus on… his response was.. “learn how to say no”.

    Thanks for the contribution. Darlene

  3. Margaret Bartley says:

    This is purely anecdotal, but I have NEVER heard a man deprecate his desire to earn money, but it’s actually very common for women to explain why they are willing to settle for less money than they could earn, or for less than they deserve.

    I don’t know what it is about the way women are conditioned in our society, but it’s like a shameful thing for many women to say they want to make as much money as they can, and that they are prioritizing earning an income.

  4. Great article! We will be linking to this great content on our
    site. Keep up the great writing.

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