New BMO Report on Entrepreneurs Reveals That 63 per Cent of Women Are Likely to Turn a Profit Within Two Years of Business
OREANDA-NEWS. November 05, 2015. A report on Canadian entrepreneurs released today by BMO Bank of Montreal revealed that while there are challenges involved, Canadian women are seeing the benefits of entrepreneurship.
The report, which surveyed female entrepreneurs and was conducted by Pollara, revealed that they needed an average of \\$201,729 to start their businesses. However, 63 per cent turned a profit by the two year mark, belying the common notion that most small businesses fail within their few first years of operation. Additionally, almost three-quarters (73 per cent) are currently turning a profit.
The report also revealed some key challenges that female entrepreneurs faced when starting their businesses, including:
- Supporting their families until business was profitable (51 per cent)
- Obtaining capital to get started (43 per cent)
- Building a customer network (43 per cent)
- Getting advice on how to get started (20 per cent)
"Entrepreneurship is a challenging but rewarding venture when you have a plan in place and have the right help and advice. We're here to help woman-owned businesses as they continue to expand in this growing market," said John MacAulay, Head, Canadian Commercial Banking, BMO Bank of Montreal. "In 2014, BMO made an additional \\$2 billion in credit available to women-owned businesses across Canada over the next three years. Part of BMO's commercial banking mandate is to address the growing needs to women in business."
Service and Retail Sectors Featuring the Highest Number of Female Entrepreneurs
The Women's Business Economic Advisory Council (WBEAC) states that firms wholly or partially owned by women represent 47 per cent of small and medium-sized businesses in Canada.
Overall, the retail sector tends to showcase the highest number of female entrepreneurs. According to BMO's report, the major sectors in which women entrepreneurs are currently operating include:
- Retail (wholesale, imports/exports and distribution): 30 per cent
- Services (healthcare, real estate and food and beverage): 17 per cent
- Professional services (technology, financial services, business services, consulting, marketing and telecommunications): 14 per cent
"The service sector, which includes retail trade, has been a stalwart this year, despite the talk of a technical recession," said Sal Guatieri, Senior Economist, BMO Capital Markets. "Service sector real output is up 2.2 per cent in the six months to July relative to the same period last year, with retail trade up 2.7 per cent."
Mr. Guatieri noted that continued steady consumer spending amid low interest rates should sustain steady growth in the service sector and retail industry in 2016.
Interestingly, the survey also revealed that manufacturing and construction (automotive, transportation and industrial) were other major sectors in which women are currently operating in at 17 per cent. Both sectors have been hurt by the downturn in energy production, but should improve when oil prices recover next year, added Mr. Guatieri.
"It's important, as a financial institution, that we continue to foster these women and remain committed to providing them with the resources and advice they need to make sound financial decisions to ensure growth and prosperity," said Sheri Griffiths, Regional Vice President, Commercial Banking, GTA North and East Division, BMO Bank of Montreal.
To learn more about BMO's business services, please visit www.bmo.com/business.
Survey results cited in this report are from phone interviews with a random sample of 501 Canadian small business owners or managers conducted between August 20th and September 8th, 2015. The margin of error for this survey is ± 4.4%, 19 times out of 20. Data has been weighted using the latest census information to be representative of Canadians business as a whole.
About BMO and Women Entrepreneurs
BMO Bank of Montreal has a long history of championing the advancement of women in Canadian business. BMO is a partner with national organizations including WBE Canada and Women Presidents' Organization. BMO is also the founding and leading partner in development for GroYourBiz.
About BMO Financial Group
Established in 1817, BMO Financial Group is a highly diversified financial services provider based in North America. With total assets of approximately \\$672 billion as of July 31, 2015, and more than 47,000 employees, BMO provides a broad range of retail banking, wealth management and investment banking products and services to more than 12 million customers and conducts business through three operating groups: Personal and Commercial Banking, Wealth Management and BMO Capital Markets.