CAPE TOWN - The Western Cape has seen an increase in women-owned products and brands, as well as higher turnover and increased growth than in businesses owned by men.
This is according to a survey conducted by SME-funding business Retail Capital, which stated that the region was a hub for female entrepreneurs.
Retail Capital was established in 2011 to provide South African business owners with the opportunity to grow their business through access to funding and has since provided more than R1.5 billion to the South African SME industry.
The survey found that women in the Western Cape tended to make smart investment decisions leading to their businesses seeing higher turnover. In fact, women-owned businesses experienced 50 percent more growth than businesses owned by men in the Western Cape.
Looking at a relatively small pool of 53 businesses in the province, the survey found that there was a 70 percent increase in turnover in women-owned businesses in the Western Cape versus an 18 percent increase in businesses owned by men in the first five months after taking funding. In Gauteng, of a pool of 116 businesses, almost half were owned and run by women.
This significant rise in the success of female business owners in the Western Cape is, in part, owing to the fact that women are willing to take the same risks as men when it comes to business, but they typically make smarter decisions with their money and are less likely to default on business loan repayments.
Five months after receiving funding from Retail Capital, women saw a 27 percent credit turnover compared to just 8 percent achieved by businesses run by men.
In the same period, women were seen to be 60 percent less likely to default on payments than men.
Retail Capital’s chief brand officer Erin Louw said women tended to take longer to make big business decisions but had a tendency to have more deliberate investment goals.
“In the Western Cape, we are seeing more and more women taking funding to grow their businesses and they are seeing significant returns. This, in turn, shows more women that they can succeed in business with the right tools and support.
According to our study, women invest funding for their businesses wisely and see higher turnover than men,” says Louw.
Retail Capital also found that 64 percent of women were taking funding with flexible repayment structures to mirror their business’s cash flow cycle as opposed to the fixed payment structures offered by traditional funders.
“In an unstable economy, taking funding out with a provider such as Retail Capital enables you to be flexible ‒ just as your business is. Any small business is unlikely to see the same fixed returns from month to month, which may make it difficult to stick to a fixed payment structure,” explains Louw.
“From any business owner’s perspective, this flexible structure might be harder to get your head around as you are not paying a fixed amount over a fixed period. However, figures show that in today’s economy flexible repayments are a savvy choice for SMEs.”