Women-Owned Small Businesses See Big Jump in Earnings, Loan Applications and Credit Scores

Women-Owned Small Businesses See Big Jump Earnings, Loan Applications and Credit ScoresSmall businesses owned by women saw significant gains in 2013 in earnings, business credit scores and loan applications, according to Biz2credit‘s just-released report.
The online credit marketplace studied 10,000 companies and found that earnings of women-owned businesses shot up 54 percent in a year-to-year comparison.
Average earnings for women-owned businesses surged to $54,114 in 2013, from $35,135 in 2012 — a huge 54 percent jump year-over-year.
Moreover, the average credit score for women-owned companies rose to 610 in 2013, up from 592 in 2012.
“The 600 benchmark is critical for any business seeking funding,” said Rohit Arora, CEO of Biz2Credit, who oversaw the research. “Companies with credit scores under 600 find it next to impossible to secure bank loans and often resort to borrowing money from higher cost sources of capital, such as alternative lenders.”
While the average credit score for women-owned businesses was 14 points lower than for male-owned companies, the gap has closed — in 2012, the difference was 40 points.
Biz2Credit also found that twice as many women-owned businesses sought funding than they did in 2012.
Overall, they raised $55 million with an average loan size of $85,000.
Additionally, women are applying for loans after slightly more than two years in business (27 months), rather than 40 months in business, which was the case in 2012.
Women-owned vs. Male-owned Businesses
Women to Men Ratio: 27% vs. 73% registrations on Biz2Credit.com in 2013
Average Annual Revenue: Average revenue for women-owned businesses ($54,114) was $24,617 lower than the annual revenue of male-owned companies ($78,731) in 2013.
Average Operating Expenses: Women-owned businesses tended to have average operating expenses.  Expenses were 41% of earnings for women-owned businesses; 38% for male-owned companies
Average Credit Score: On an average, the credit scores for women-owned businesses (610) were 20 points lower than for male-owned companies (630).  The difference was 40 points in 2012.
Average Age of Business (in months): 27 vs. 31 (the age of businesses applying for loans was lower for women-owned businesses)

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