What the Future Holds for Women-Owned Businesses

It's no secret that women face a certain set of challenges in starting their own businesses. Those hurdles became even greater in 2020, with the emergence of COVID-19 ushering in drastic changes for the global economy and disrupting well-laid plans for all companies, including women-owned businesses. As business leaders rethink strategies for survival and growth, what opportunities will 2021 hold for women entrepreneurs?

Understanding systemic challenges

COVID-19 has brought major changes for many business owners. Several studies suggest that women-owned companies may have been disproportionately burdened. Gender-based inequalities in two fundamental areas—access to capital and societal expectations for work-life balance—may be among the biggest drivers of this disparity.

An unexpected free-fall in revenue can generate cash flow crunches and impact long-term business health. Research suggests that women entrepreneurs are less likely to seek and obtain financing for their business than men. This means they may also face structural obstacles when claiming their share of COVID-19 relief initiatives, such as Paycheck Protection Program loans.

Maintaining a sustainable balance between work and personal life can be a part of a robust business strategy for all entrepreneurs, but especially for those with caregiving responsibilities. Women tend to bear a heavier load than men in balancing work and household duties, making this area a particular challenge for women entrepreneurs.

The pandemic may have exacerbated this inequality. Schools, caregiving centers and related support options have become increasingly less available due to COVID-19-related restrictions. Women business owners often find themselves trying to support the dynamic needs of their children's virtual schooling during the same hours they must give focus and energy to critical business decisions and activities.

Adapting for opportunity

The economy and all its moving parts may never be the same after COVID-19, at least for the foreseeable future. Here are some ways women entrepreneurs can tap into their agility and resilience during uncertainty and adapt their business model to the new normal.

Think of your people first

Rehiring and retraining can be time consuming and expensive, even in an uncertain job market. During the year ahead, keep in mind that structural inequities may continue to play a big role in the needs of both women entrepreneurs and employees. Consider adopting a more flexible work-life balance approach to help attract and retain a talented, dedicated team.

Not every business can restructure operations to offer all employees a way to work from home. Perhaps you can offer the choice of a flexible work week, which can bring the added benefit of less contact risk for employees working on non-peak days. Your employees may also benefit from the ability to work outside core business hours, whether they work from home or not.

Other options, such as job sharing or temporary reduction of hours, can be advantageous to employees and women entrepreneurs alike. And don't forget comprehensive employee benefits can go a long way toward allowing a business to stay innovative and competitive. These can include affordable health insurance, flexible PTO, subsidized caregiver support service and flexible spending accounts.

Use technology to respond to change

Women-owned businesses looking to recover and stay competitive will be expected to harness technology, including the latest innovations in artificial intelligence, for the COVID-19 era. Think about how leveraging this and other emerging technologies can allow your business to respond more efficiently to shifts in consumer demands or changes in the supply chain. Does your business generate a lot of data? Maybe better, more organized access to this data can drive insights for cost optimization or improving the customer experience. Don't forget to consider how you may be able to repurpose your existing equipment or technology to fit a new consumer need.

Remaining agile and resilient

Women entrepreneurs can position their companies for better outcomes in 2021, beginning with a resolve to obtain adequate capital. Reach out to a banking partner that understands the issues that women-owned businesses face. Together, you can find ways to improve your financial management strategy and prepare financing options that meet your business needs.