By Rieva Lesonsky
For a long time, the number of women-owned businesses whose revenues top $1 million has been far disproportionate to the numbers of women starting and running their own businesses. According to U.S. Census data, the number of women-owned firms grew by 28.6 percent between 2002 and 2012, outpacing the 24.4 percent increase the number of U.S. businesses overall. But while women are launching businesses in ever greater numbers, just 2 percent of women-owned companies have sales over $1 million.
But there’s some good news hidden in that statistic. Recently, American Express OPEN and Womenable decided to drill deeper into Census data about women-owned businesses that had over $1 million in sales. They broke the businesses into three revenue categories: $1 million to $4.9 million, $5 million to $9.9 million, and $10 million-plus. Their findings, published in Growing Under the Radar: An Exploration of the Achievements of Million-Dollar Women-Owned Firms, show that among the over-$10-million category, the number of women-owned businesses has surged by 56.6 percent since 2002.
That’s 47 percent higher than the 38.4 percent increase in all businesses (both male- and female-owned) with sales of over $10 million. And in addition to outpacing $10-million-plus firms overall in growth, women-owned $10-million-plus firms are growing at a whopping 98 percent faster pace than women-owned businesses overall.
How do the $1-million-plus women-owned businesses break down overall? Some 87 percent have under $5 million in sales, and 10 percent fall in the $5 million to $9.9 million range. Only 8 percent of the $1-million-plus women-owned businesses make $10 million or more. That’s similar to the way that the majority of all small businesses fall on the lower end of the sales spectrum.
There’s good news of another kind in the study’s findings. While in the past, Womenable president and CEO Julie Weeks says, most women with firms in the $10-million-plus category had inherited the businesses from fathers or husbands, today most of them are heading companies they started themselves. Womenable believes the greater visibility of and support for high-profile women in business and government is a contributing factor in the growth.
So in what industries are women most likely to head $10-million-plus companies? Wholesale trade (20 percent of women-owned firms there have passed the $10 million mark), finance/insurance (12 percent), transportation/ warehousing (11 percent), and arts/entertainment/recreation (10 percent) topped the list. Womenable says the fact that these industries tend to be more scalable than most has undoubtedly helped the women-owned firms in them expand.
Image by Flickr user (Creative Commons)