For once, there is something about women-owned businesses to cheer about, at least according to the SME Survey 2014, the annual study of factors behind the success of small and medium enterprises (SMEs) in South Africa.
A small business owned by a woman has a better chance of being profitable than one run by a man, indicate the study’s findings.
If you want to make less profit run your business with your spouse or a partner of the opposite gender, is the study’s moral. It found that those companies owned by couples or a mix of genders are substantially less likely to be profitable than those operated by either male or female-owners.
Explaining this trend, Arthur Goldstuck, SME Survey principal researcher and MD of World Wide Worx, says: “This shows that there are additional challenges which come with owning a business together with your spouse or partner, or where joint owners have different personal agendas or management styles.”
Before one get carried away with the results as a sign of the advance that women have made in business, cautions Arthur Goldstuck, SME Survey principal researcher and MD of World Wide Worx: “While this result may seem like a big win for women, it comes with an immediate qualifier: the level of female ownership is exceptionally low.”
The breakdown of the results were:
Male owned SMEs:
• 20% are strongly profitable
• 49% are just profitable
Jointly owned SMEs:
• 16% are strongly profitable
• 37% are just profitable
The female owned SMEs
• 15% are strongly profitable
• 63% just profitable
This equates to 78% of women-owned businesses being profitable, well ahead of the 70% for men.