New women-owned small businesses outpace male counterparts in Australia

Small businesses in Australia are increasingly being led by women. In our experience as a lender, the way women run enterprises can sometimes give them an edge over their male counterparts.

One in three small businesses in Australia are now run by women and that number is growing. Between 2006 and 2021 female small business owners increased by 24%, which was more than three times the growth of their male counterparts.

However, women are still under-represented in the leadership of ASX and other large businesses in Australia despite progress in recent years.

A report from the Australian Institute of Company Directors earlier this year shows just 35.6% of board seats in the wider ASX300 are filled by women meaning there’s still a lot of work to do although 40% of board seats for the ASX20 are now filled by women, which is encouraging.

As a lender, I can confirm that one of the defining characteristics we’ve noticed among our women clients is that they don’t appear to be as reluctant to ask difficult questions. It is often the answer to those hard questions that leads to business improvement and efficiency gains or alternatively pivoting the business model to operate better.

Banjo client Erica Hughes is the owner and director of the health food business Slendier. This fast-expanding business started in 2013, with Erica purchasing the brand in 2017 with a strategy to grow the business in terms of geographic expansion, marketing and new product development.

Slendier focuses on all-natural, plant-based, healthy and delicious food that is genuinely good for you. Having come from a corporate background, Erica was looking to make a change and gain happiness through a new career journey that involved her owning and setting the strategy for her own business. The Slendier business now sells in both supermarkets and online throughout Europe, the Middle East, Southeast Asia, China, Australia and New Zealand.

Erica says it’s tough for anyone to own a global business right now and you need to back yourself with every decision. Erica’s advice for other female entrepreneurs is to, “be confident, boldly step over each roadblock, seek out mentors and others who inspire you, and also take time to look after yourselves”.

Renata Freund, founder and director of Honeybomb Strategy, an innovative market research and customer insights agency, says learning from other business owners who are well on the path to success has been key to Honeycomb’s growth.

Renata says: “Rather than spending years trying to succeed through trial and error, we learn from the experiences of other successful entrepreneurs to shortcut our journey. No matter the challenge, there is always someone in my network who has had similar experiences and can share their thoughts on how best to navigate the road ahead. Without this network to tap into, business would be a lot more challenging and daunting”.

Another viewpoint comes from Sonja Pfitz of Pfitz Financial & Business Solutions, a commercial finance broker for SMEs, specialising in local and global funding solutions for manufacturers.

Pfitz Financial has a wide range of clients from small to large companies, some of which are publicly listed, operating in a range of industries including steel, plastics, defence, food and beverage, chemical and medical sectors.

Sonja’s 25-year career in finance and owning various businesses has given her first-hand experience and insight into the funding challenges ​faced by manufacturing companies.

Sonja’s advice for SME women in manufacturing businesses is: “Own your vision with passion and transparency. Be wise in surrounding yourself with specialists to support you and the growth of your business. Never take a setback as a failure, rather it is a challenge that will make you even more successful, from the lessons you have learnt. Most of all take time to look after yourself as a healthy mind and body is key to being a healthy, happy effective director”.

Of course, the picture isn’t completely rosy, as there are still hurdles faced by women running their own businesses. Various studies, both local and international, consistently show that women entrepreneurs are hindered by three main issues in comparison to their male counterparts:

• less access to funding and capital
• less access to supportive business networks
• unconscious gender bias by some male investors

International Women’s Day next year in March will again bring focus to women and their achievements. Hopefully we’re getting closer to a time when women’s contributions and achievements are recognised as a matter of course, not just on a special day.

This article was first published by Women’s Agenda.