Financial News |
|
Your Money > Investments Articles > Women mean business
|
|
By Sarah Modlock
Women across the UK are setting up more businesses than ever before - around 100,000 a year. What are they up against and what help is available if you want to start up on your own? "It's clear that in many areas women are taking the lead and demonstrating how much they can contribute towards the business sector and the UK economy as a whole," says John Davis, marketing director for Barclays Local Business. "Business start ups such as property services, which include interior design and property development, offer increasing flexibility and are proving very popular with women who are often juggling careers and family commitments. Also in the 21st century there are a lot fewer barriers to entry for women and they are taking advantage. I am sure in a few years time, that in some areas of the market, more businesses will be started by women than men," he says. Getting started Once you have made the decision to go it alone, it seems that there are various hurdles to be tackled. One is funding. Research conducted by finance trade body the FDA at a series of road shows across the country revealed that the majority of female entrepreneurs agree it is harder for women to get access to funding than men and feel they are left out in the cold by banks. The top three barriers to starting a business cited by survey respondents were lack of funding; no time and; family commitments. While lack of funding was the biggest barrier, women based in London said inadequate advice was the biggest obstacle. The research found that all women were motivated to start their own business by the prospect of being their own boss, followed by flexible working and financial rewards. The majority intended to start their own business within the next 12 months, with a third of London women being particularly entrepreneurial and wanting to achieve their goal within three months. Interestingly, the major difference that emerged across the regions was the source of financial advice, the criteria they use when choosing their financial providers and how often they seek advice. Women from the East Midlands seek advice from professional advisers such as accountants and bank managers, while Londoners and Yorkshire women head to public sector bodies such as Business link and the Small Business Service for guidance. Success stories With hard work and success comes more money. A Barclays Wealth survey reveals that the affluence and influence of women is growing and is increasingly fuelled by their own individual enterprises - showing the perception of inheritance and marriage as the lead sources of female wealth is out-dated and that the vast majority of women are generating their wealth independently. Wealth is largely driven from earnings and business ownership (84%) or from personal investments (a third). This compares to marriage (a quarter), divorce (2%) and inheritance (a fifth), which the research shows are becoming less important sources of wealth. Women's growing economic power is reflected in the increase between 2006 and 2007 in the number of women featured on the Sunday Times Rich List, which grew from 81 to 92. The combined wealth of Britain's richest women in 2007 is £33.27bn. Meanwhile, it is predicted that by 2020, female millionaires will outnumber male millionaires in the UK at 53%. Behind the US, the UK has the highest proportion of women in managerial positions among OECD countries, with 117 female directors of FTSE 100 companies, while 77% of those companies have at least one woman on their board. Top tips Kate Sharp, Chief Executive Officer of the FDA offers this advice for women thinking of starting their own business: 1. Always have a business plan, if you are not clear about what you are doing and where you are going others will not be inspired to invest in you. 2. Don't be worried about seeking the advice of others when putting your business plan together. Speak to people who have established businesses themselves, seek advice from the relevant agencies about the best way to construct and lay out your plan. Time invested at this stage will reap dividends later. 3. Make sure you have considered all of your financial requirements. An under-funded business is a guaranteed route to failure. 4. Make your trading figures prudent. Financiers are not impressed by over rapid growth projections and unrealistic profit margins. They need to believe that your projections are achievable and sustainable. 5. Make sure your business plans clearly demonstrates how you will pay your financier back, if they cannot how they will recover their investment they simply will not invest. 6. Think carefully about your financial needs in terms of the most suitable means of obtaining funding. There are many different types of funding out there besides the obvious loan or overdraft, from venture capital investments, mortgages for property, leasing for plant and machinery and invoice finance for cashflow. Seek the most appropriate type of funding for your needs. 7. Be prepared to make a personal commitment to your business. You cannot expect others to invest in your business if you are not prepared to invest in it yourself. Financiers and investors will want to see a personal commitment before they invest their money. 8. Have reasonable expectations, most financiers will look for some form of security if they are to advance funds to you. Don't expect to borrow more than the value of your security. 9. Don't just approach one financier, try a number and compare the offers you are made before accepting the one that is best for your business and always read the small print on the contracts. 10. Make sure your figures include the cost of finance, if you are only making a profit for your financier and not yourself and your business it's simply not worth it. Useful links:
|
| ||||||||||||||||||
|
Copyright © 2007 |