Updated: Oct 9, 2020
In today’s entrepreneurial landscape, organizations owned by women make up over 40% of US businesses. That is a promising trend that shows that now more than ever before, women are feeling empowered and supported as entrepreneurs.
While this stat is optimistic, it is important to note that women entrepreneurs still have less access to capital than men, and if a woman is an ethnic minority the hurdles are even more challenging. The success of entrepreneurial women is hard-won, and that is why it is critical for the longevity of a woman-owned business to have a solid financial system in place.
It is critical to the success of any business that you know how to generate, maintain, and track revenue. In this post, I’ve included a quick list of fundamental things for women entrepreneurs to keep in mind when it comes to accounting for their businesses.
Are you a registered Woman-Owned Business? Federal, state, and local government agencies often allocate a certain percentage of contract dollars to go toward the hiring of women-owned businesses. However, if you are not officially registered with the approving agency, you may not technically qualify to put in a bid for a contract. This is why it is important to take the time to complete the process of becoming officially woman-owned. You can check out the SBA process here. I also recommend a simple Google search to learn more about how to apply for any local designations required to secure local government contracts. Securing government contracts can be a great way to generate recurring revenue and grow your business.
Look For Tax Benefits
Though no exclusive tax benefits are designated to women-owned businesses, there are tax codes out there that women business owners often do not take advantage of. Speak with a business advisor or CPA and ask specific questions about what tax codes you should be considering. You may need to change the structure of your business, file with a different designation, or enroll in certain programs. The saying that “you don’t know what you don’t know” is true, and that’s why it’s important to consult with an expert.
Know Your Numbers
As a woman in business, you are part of the incredible push in the last 20 years to level the playing field when it comes to entrepreneurship. Seriously, women-owned businesses have increased by 114% in the last 20 years and you’re in that number! In order to stay in that number--you need to know yours. Even if your access to capital is less than your male counterparts, having accuracy in your bookkeeping, accounting systems, and tax filings can make a huge difference in your ability to maintain positive cash flow and generate a profit.
No matter what stage of business you’re in, becoming official, taking advantage of tax benefits, and knowing your numbers are important for the foundation of your business. Joining coaching groups and chambers of commerce that are specific to women entrepreneurs can also boost your opportunities for business development. Working with a business accounting expert can help you understand the best options available to you as a woman in business.
For more than a decade, Desnoyers CPA, LLC, a woman-owned Business Advisory Firm, has advised business owners from all walks of life. Founder Lydia Desnoyers knows what it means to pursue passion, financial freedom, and flexibility. As South Florida’s trusted Business Advisors, our team empowers business owners to make the best financial decisions for personal and professional success.
Learn more about our Business Advisory/Virtual CFO services, and schedule a complimentary call today!
This blog article is for informational purposes only and is not intended to be the rendering of legal, accounting, tax advice, or other professional services. Information provided on this website is not all-inclusive and such information should not be relied upon as being all-inclusive.