Published on October 15th, 2014 | by Millennium Magazine Staff0
Helping Women-Owned Businesses Get to the Next Level
By Erin Andrew, SBA Official
The face of entrepreneurship is changing in America. Women-owned small businesses are one of the fastest growing sectors of our economy and are helping us recover from the Great Recession.
Yet, there are still challenges women small business owners face – lack of access to capital and resources, lack of knowledge about business basics, and lack of financial education. But women entrepreneurs should not be discouraged or deterred for these reasons. The SBA stands alongside entrepreneurs, including women, to help knock down these small business obstacles.
At SBA, we know business success can be achieved with the right tools. It is clear that entrepreneurship helps to increase the purchasing power of women-owned small businesses. The SBA plays a key role in helping businesses start, grow and succeed. As we recognize the contributions of women who have shaped our economy and our world during Women’s Small Business Month, we continue to strive to eliminate the barriers to successful entrepreneurship for women.
It is believed that women in general make up as much as 80 percent of all U.S. purchasing decisions and influence more than three trillion dollars in consumer spending, including food, cars, banking, and health care. According to the U.S. Census, women own 7.8 million businesses, which accounts for 28.7 percent of all businesses in the United States. Women employ 7.6 million individuals and generate $1.2 trillion in receipts. Now that’s power in numbers.
As champions for small businesses, SBA recognizes that women are under-represented in the federal contracting marketplace despite being essential job creators in communities across the country. Federal contracts provide crucial opportunities for owners of small firms to boost their small businesses to the next level and create good-paying jobs.
That’s why we rolled out the SBA Women-Owned Small Business Federal Contract Program (WOSBs) in 2011. This program authorizes contracting officers to set aside federal contracts for eligible women-owned small businesses or economically disadvantaged small businesses to ensure women earn a fair share of the federal marketplace. Continued support for women is essential as women-owned small businesses have grown by 20 percent in five years, and a quarter of all small businesses are now owned or led by women.
In fiscal year 2013, the federal government awarded $15.3 billion in contracts to WOSBs, totaling 4.32%, just short of the 5% goal. Women entrepreneurs are considered under-represented in only 83 of the 260 industry categories, limiting their ability to receive federal set-asides. We believe the explosive growth of women-owned businesses will show that many additional industries should be added. As such, SBA will conduct a study to identify and report on industries underrepresented by WOSBs, possibly opening the door for more WOSBs to participate in SBA’s Women’s Federal Contracting Program.
But the most important advance we could make to level the playing field for women is sole-source contracting authority. SBA Administrator Maria Contreras-Sweet has called on Congress to extend this authority to bring women-owned businesses into alignment with other groups that already have it. Legislation is now pending in Congress.
The SBA offers additional resources such as local Women’s Business Centers (WBCs). WBCs are an effective resource that encourage and help women small business owners navigate to success through mentorship and training. Additionally, there are various SBA loan programs that can cater to your small business needs.
SBA zeroed out fees to borrowers on SBA-supported loans under $150,000. This is important because lower-dollar loans often help finance new startups and entrepreneurs in underserved communities, which include women. Setting fees at zero effectively makes these loans cheaper for borrowers, encouraging lending to small businesses that face the most constraints on credit access and will create lending opportunities important for underserved communities.
I encourage and challenge every entrepreneur to tap into the resources at the SBA so that we can continue to be well-positioned to assist small businesses as you look for opportunities to grow, hire and diversify your businesses in our growing economy.
Be sure to visit SBA’s portal for women entrepreneurs to help jumpstart your potential woman-owned small business.