It's true today as never before: women mean business. A new study by the National Foundation for Women Business Owners, a nonprofit research organization based in Silver Spring, Maryland, demonstrates how rapidly women-owned firms are increasing in number, range, diversity and earning power.
Now comprising nearly eight million businesses across the country and employing 18.5 million people, women-owned firms are growing twice as fast as their male counterparts and faster than the economy overall. They also pump almost $2.3 trillion into the U.S. economy annually, more than the gross domestic product of most countries. As President Clinton said after being presented with these startling numbers, "Women business owners are the new face of the American and global economies."
Women are indeed changing the face of the American economy - and fewer and fewer are doing it the hard way. According to the same study, approximately 23 percent of women just starting out financed their dreams with credit cards in 1996 (down from 54 percent in 1994), evidence of the increasing availability of other sources of financing.
Because the U.S. Small Business Administration and its Office of Women's Business Ownership (OWBO) are determined that women will have the access to capital they need, we have greatly increased our outreach efforts. The results have been spectacular. Since 1992, the number of SBA guaranteed loans to women increased 300 percent, in part because of the introduction of two new programs:
In 1993, the SBA developed the Low Documentation Loan Program, which cut the application for certain loans under $113,000 from an inch-thick document to a single page. This program eliminates red tape for those applicants (often women entrepreneurs) who are seeking smaller loans than some banks like to write. Official answers are generally returned in three to five business days.
In 1994, the SBA also launched the Women's Prequalification Loan Program. This program, currently available in 16 locations but expanding to many more sites, looks at an applicant's character, credit history and ability to pay - not just at her collateral. Applicants accepted for SBA guarantees go to banks prequalified for the loans they need, up to a maximum of $250,000.
But the OWBO has a wider mission than just helping women obtain loans. We also want to jump start their businesses, and help them grow. Our 54 Women's Business Centers across the country provide financial, managerial, marketing and procurement training for 2,000 potential and existing entrepreneurs every month.
Soon our clients will be able to receive training and counseling on the first-ever women's business network on the Internet. Sharing information about exporting or procurement, accessing new sources of capital, or locating an empathetic mentor will become as simple as tapping a computer key. We believe this "Women Business Intranet" will vastly enlarge our potential to help more women become economically independent, provide support for their families, and increase their contributions to the nation's economy.
Today, the sheer numbers of women running their own businesses tell us that a profound change has taken place in the lives of millions of women - and their families and communities - in less than 20 years. But those numbers alone don't indicate how mature some women's firms have become: 28 percent of women-owned firms have been in operation 12 years or longer, compared with 30 percent of all companies.
In addition, SBA's 1996 Small Business Week Awards spoke to the excellence many women are bringing to their endeavors: the 1996 Exporter of the Year, the Subcontractor of the Year and - the top award - Small Business Person of the Year, were all women.
If you have a dream of starting your own business, and want to know more about our loan programs, technical assistance and training, counseling and mentoring programs - all designed to help women entrepreneurs become full partners in the national and global economies, as well as their own home towns - contact your local SBA District Office.
Or access various kinds of information about women and business through the OWBO Home Page, where descriptions of all our SBA resources exist - including the location of all 54 Women's Business Centers. You can even download loan applications to your own printer. The electronic mail address is: http://www.sbaonline.sba.gov/womeninbusiness.
We at the OWBO believe in the dreams of American women, and are dedicated to making them come true - including yours.
Sherrye Henry, Assistant Administrator
Office of Women's Business Ownership
U.S. Small Business Administration
Excerpted with permission from Small Business Success magazine, Volume X, produced by Pacific Bell Directory in partnership with the U.S. Small Business Administration and the Partners for Small Business Excellence.