Only one in five businesses in the UK is started by women but research by FreeAgent and OnePoll has shown that more women, 12%, would like to become sole traders compared to 8% of men. According to MIWE, the number of British female sole traders is still surprisingly low, with just 5.4 women entrepreneurs for every 11.1 men. Additionally, the UK is sadly behind many European, high-income, economies including Italy, France, Denmark, and Germany. So what’s causing this disparity?
Access to funding for female sole traders
Funding is the main issue for female sole traders. According to the Entrepreneurs Network only 9% of the funding into UK start-ups goes to women-run businesses. As a result their business growth is significantly slower.
Women also tend to start businesses with much less available capital than men. AXA reports that women are at a further disadvantage with the vast majority often starting a sole trader business following a career break or part time working. 63% of men start their business straight out of a full-time job.
Even though there have been improvements, the pressure to balance the responsibilities of work and family is still much greater for women than it is for men.
The women who do manage to combine family life and their sole trader businesses are valuable to the UK economy. A report commissioned by eBay, found that the “mum economy” generates £7.2bn for the UK and supports 204,000 jobs. By 2025, these numbers are predicted to rise to £9.5bn and 217,600 jobs.
Lack of mentors or networks
Less female entrepreneurs means there is a shortage of valuable mentors and ability to connect and broaden professional networks. As we’ve already seen, the challenges many female sole traders face are different to their male counterparts so finding a mentor who has overcome the same challenges, that can pass on knowledge, skills, contacts and encouragement can be vital to the success of a business.
Women sole traders your country needs you
Despite all these barriers, businesses founded by women earn twice as much money than those founded by men and women-owned businesses are safer for investors. (Boston consulting group) Additionally, women-owned businesses have the same survival rates as businesses owned by men. (JP Morgan Chase)
Funding is a major issue but things are improving. There are a wide variety of grants available plus lots of support from your local enterprise agency. There are growing numbers of ladies networking groups and there are some excellent industry specific social media networking opportunities.
In addition go out, find women in your industry and ask them to mentor you. Speaking from personal experience, my own mentor has kept me motivated, accountable and sane over the last few months!
With unemployment rates predicted to hit over 11% in the coming months now is the time to start investing in that side line. Yes our challenges are greater but female resilience and entrepreneurship is what this country needs now more than ever.