Women-Owned Business Study 2020

Financial Performance

March 13, 2020

Credit Scores and Revenue of Women-Owned Businesses Rose, But Revenue Gap
Grew in 2019, According to Biz2Credit’s Annual Study

According to Biz2Credit Study Analysis of 30,000 Firms Finds Revenues and Costs Up;
Texas Is The Top State for Loan Requests

The average annual revenues of women-owned businesses rose 68% in 2019 to $384,359 from $228,578 in 2018, according to the annual study of women-owned companies by Biz2Credit, a leading online credit marketplace.

Women business owners overall did well in 2019 and contributed significantly to the strong U.S. economy.

Rohit Arora

Biz2Credit CEO

Women-owned businesses accounted for 29.1% of funding applications, whereas non-women-owned businesses accounted for 70.9% of applications.

Women borrowed 29.1% of loans in 2019 whereas men borrowed 70.9% of loans in 2019.

In 2018, the average credit score for women was 590 and then decreased to 588 in 2019. In 2018, the average credit score for men was 613 and stayed at 613 in 2019.

 
There’s no doubt that women-owned companies are performing better than they have at any other time in history. However, the factors that have helped buoy firms owned by women are also bolstering firms owned by men

Rohit Arora

Biz2Credit CEO

Businesses owned by men in 2019 generated an average annual revenue of $752,154 in 2019, a nearly 60% jump from $473,157 in 2018.

Women-owned businesses ($384,359) earned $367,795 less on average than male-owned firms ($752,154) in 2019.

In 2019, the average loan size for women-owned businesses was $40,513, whereas the average loan size for men was $69,596.

After the New Year, business lags a little bit. Sometimes, we see a 30% decrease in our numbers,” said Dicenso, who received funding in less than a week after applying for it through Biz2Credit. “We did a $30,000 small business loan and during a recent break hired a painter come in and do some touch ups to give the place a fresher look. The loan provides us with a cushion for leaner times.

Anna Dicenso

Rino's Restaurant

Average Operating Expenses for women-owned businesses were slightly higher for women (72% of revenues) than for men (67% of revenues) in 2019.

Nearly one quarter of loan applications came from women-owned businesses in the Services category, which includes translation and public relations services, hair and nail salons, and cleaning companies. Next came Retail, Food & Hospitality, Health Care and Social Assistance, Arts & Entertainment, and Construction.

Average Age of Business

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In the first few years, the hardest part was getting people to validate and believe in me. They didn’t know what to think of a 26-year-old girl who was coming to buy a lot of beer and liquor for a bartending company. Now, for some distributors, I’m the biggest customer in the state.

Tammy Johnson

High Spirits Hospitality

The Top Five States For Applications

Key Findings:

  • Percentage of Applications from women-owned businesses in 2019 was 29.1%, compared to 28.8% of the applicants in 2018.
  • Average Annual Revenues of women-owned business rose to $384,359 in 2019, a 68% increase in revenues over $228,578 in 2018.
  • Average Credit Score for women decreased by 2 points from 590 (2019) to 588 (2018).
  • States with greatest number of loan applications from women-owned businesses were Texas, which pushed California to No. 2, followed by Georgia, New York, and North Carolina.
  • Industry Sectors: Services (except Public Administration), followed by Retail, Food & Hospitality, Health Care and Social Assistance, Arts & Entertainment, and Construction.

Quotes From Experts

Rohit Arora

CEO Biz2Credit

“There’s no doubt that women-owned companies are performing better than they have at any other time in history. However, the factors that have helped buoy firms owned by women are also bolstering firms owned by men. Interest rates are low, the stock market is strong, business optimism is high, and consumers are spending.”

“The strong economy is like a high tide that raises all the boats. When businesses owners are doing well, they can invest in their companies. With strong financials and an overall atmosphere of optimism, borrowers have confidence in expanding their enterprises.”

“Meanwhile, lenders are willing to make small business loans. Advanced financial analytics has dramatically reduced default rates for banks and other lenders, and those that make SBA loans have their risk mitigated by the government guarantees. This makes it very attractive to provide capital to small businesses.”

Adrienne Garland

Women's Leadership Expert

“It’s encouraging that the percentage increase in revenue for women-owned businesses outpaced male counterparts. However, to be at parity, these businesses would need to almost double their revenue – a challenging feat even in the best economic times,” said Adrienne Garland of She Leads Media, an expert on women’s entrepreneurship”.

"I remain eternally optimistic that women entrepreneurs will continue to deliver strong revenue growth, and expertly manage expenses to produce be efficient and profitable companies."

"According to Biz2Credit CEO Rohit Arora, women-owned businesses did well overall in 2019 and contributed significantly to the strong US economy."

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