Marketers target firms owned by women

By Jim Hopkins
USA Today

SAN FRANCISCO — One of every 11 U.S. women is now a business owner, says a study out yesterday, and that fast-growing niche is catching the attention of more marketers.

The number of companies owned 50 percent or more by women last year jumped 11 percent from 1997, to 10.1 million, nearly twice the growth rate of all companies, says the nonprofit Center for Women's Business Research. It based its study on Census data.

About one of every 10 U.S. adults is a business owner, the center says. It did not calculate a separate rate for men. But that figure likely is higher than the rate for women, executive director Sharon Hadary says.

As with many of the country's more than 20 million companies, female-owned businesses are often tiny, home-based operations with few employees.

But many become bigger, exerting a greater impact on the economy in:

• Revenue. Annual revenue at female-owned firms last year rose 32 percent from 1997, to more than $2.3 trillion, higher growth than the average for all firms, the study says.

As revenue grows, so does spending, attracting the attention of corporations — including Wells Fargo and Pitney Bowes — trying to grab business from growing but underserved niches.

Pitney Bowes, which partly paid for the study, wants more research on the size of the female-owned business market as the company expands beyond selling postage meter equipment, says Henry Hernandez, head of Pitney's diversity efforts. It also is interested in tapping the fast-growing market of firms owned by minorities.

Pitney is chasing customers such as Katreena Hayes-Wood, 43, who started a student career-counseling company two years ago from her Phoenix-area home. She plans to spend up to $5,000 this year for computers and a color printer as her business expands. Annual revenue could triple to $100,000 this year from a year ago, she says.

• Employment. Female-owned companies employ more than 18 million workers, up 18 percent from 1997, the study found.

Amid the soft economy, many are hiring. Principia Group, a marketing consulting firm in San Francisco whose founders include two women, could add as many as three workers this year.

Like men, women are starting companies because they want more control over their careers, entrepreneurship experts say.

But growth in the number of female-owned businesses has outstripped all firms partly because women, compared with men, see more obstacles to advancement in big companies, says Myra Hart, chair of the women's research center and a professor at Harvard Business School.