Manny Lewis, Chief Executive of the London Development Agency (LDA) which produced the study alongside its business support service operator Business Link for London, said:
“Our economy will only reach its full potential if women feel they are able to compete with their male counterparts on an entrepreneurial level. The equalities gap is reducing and we are clearly heading in the right direction.
“The key factor in increasing the UK’s business start-up rate is getting more women to start their own businesses. With the continued help of the Business Link service and other LDA supported programmes, we want to see these businesses grow and encourage other female entrepreneurs.”
Key survey findings include:
Women-owned businesses are increasing. The percentage of majority female owned businesses has grown to one in six (16.7%) in 2005 compared to only 11.4% in 2004 and 9.7% in 2003.
Black-owned businesses are more likely to be run by women than businesses in other ethnic groups. Women run around one quarter of Black owned businesses (25.5%) compared with 18.0% of White-owned and only 11.7% of Asian-owned businesses.
Businesses controlled by females have markedly more women employees. In the case of majority female-owned firms, women make up 70.0% of the workforce compared with only 22.2% for majority male-owned firms.
Female-owned businesses are more likely to be smaller than male owned businesses. The average size of female owned businesses is 3.8 employees compared to 7.7 for majority male-owned businesses.
Just 3.4% of majority male owned businesses did not use any of the four planning tools (business plan, financial plan, marketing plan and training plan), compared to 15.9% of majority female owned businesses.
Alison White, Interim Chief Executive of Business Link for London which also provides a women’s business support centre through its website, said:
“We are impressed but not surprised that the number of female owned businesses in London has increased. Working with women entrepreneurs on a daily basis shows us just how ambitious, creative and tenacious London’s women are and the determination they put into getting started and seeing their businesses grow.
“The survey does show us however, that male owned businesses are much more likely to have the building blocks of business in place – management accounts, business plan, marketing and sales plan and a training plan. We want to work with many more women to get these aspects of their business right.”
Overall, across the 4,002 businesses that took part in the London Annual Business Survey, 27.4% more businesses reported increased productivity than reported decreased productivity. Using the same measurement, 6.1% more businesses reported increased employment, 13% more businesses reported increased turnover and 7.8% more businesses reported increased profitability.