»»»» Economic Growth of Women-Led Businesses Survey Findings

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1 »»»» Economic Growth of Women-Led Businesses 2013 Survey Findings

2 A note from Women First At First Commonwealth Bank, we love supporting women in business, which is why we partnered with Campos Inc, an independent, woman-owned research company in Pittsburgh to determine the Economic Growth of Women-Led Businesses. The online survey targeted women-owned and/or led businesses in western Pennsylvania. We had 125 responses to our survey which provided great insight on how their businesses are growing and what issues they are facing. As you can imagine, each business faces its own unique challenges but we were able to uncover some common trends that all women-led businesses face, big and small. In the following pages we want to share those findings with you. Together, we can build a better business environment for all women. Sincerely, Jeanine M. Fallon Senior Vice President // Women First Chair About Women First Why the focus? With more than 70% of our own workforce comprised of women, we know that women business owners have unique banking needs. Our interest is in helping you successfully reach your business goals, and our support reaches well beyond traditional banking services. That is why we developed Women First, our company-wide commitment to women in business throughout our 15-county footprint in western Pennsylvania. Our in-depth support and expertise includes an analysis of your business plan, your competition and your long-term objectives and based upon that information, we will help you to develop effective, flexible financial solutions that fit your business model and your goals. How does this impact you? As a business primarily made up of women ourselves, we understand your unique needs. We have taken the time to know how women, as consumers, are more inclined to do business in a relationship setting and are more interested in gaining all the benefits of a full relationship. How do we live this out? We re busy throughout the year planning and sponsoring events and bringing resources to your doorstep. Annual Women First Forum Business Development Event Pittsburgh Magazine Spotlight on Women in Business Quarterly Supplement and After Hours Mixers Bi-annual Women in Business Blitz Week Representation on First Commonwealth Diversity Council First Commonwealth Mentorship Program View our full list of resources for you at fcbanking.com/womenfirst or follow our blog at fcbwomenfirst.wordpress.com.

3 Relationships matter. And devoting time to the growth of a business matters, too. The survey says Where do respondents seek business advice and/or guidance? 67 % peers/colleagues 62% other business owners 46% accountant 39% spouse or significant other 33% attorney What is the most important characteristic sought after in a banking partner? 26 % personal attention or relationship driven 13% know/understand the business or industry 10% lending solutions 8% accessible 7% value Is your business certified by any federal or state women business owner certification programs? 67 % no 33% yes Our solutions Time to focus on relationships The business community has a plethora of resources and building relationships with a team of advisors, including a business banker, accountant and attorney, is a sure step toward growth. Tips: Set up regular meetings to ensure your financial needs are being met by utilizing products and services appropriate for your ever-changing business. Make sure your business banker takes the time to understand your business, challenges and aspirations and that they offer you a needs-based solution. Introduce your business banker to your accountant and/or attorney to create a cohesive advisory team which understands and is dedicated to your goals. Become certified as a women-owned business and open yourself up to a new world of resources. Are you networking with the purpose of creating a circle of experts to help you succeed? T he solution? Developing relationships with Business Bankers to move your business forward. Get connected with a Business Banker today! fcbanking.com/business

4 The two greatest concerns for the business s future in 2013 were: We need cash solutions! Our solutions Having sufficient cash on hand to grow the business (42%) Managing cash flow during upcoming economic cycles (35%) Managing it Other Having it Cash is queen Cash management is the life-blood of every woman-owned business. That s why it s important to understand how to make cash work for you. My company s growing, but my cash flow isn t keeping up. It s not unusual to experience working capital shortages even when your company is growing. Start by reviewing your payment collection process, measuring inventory turnover and doing some simple financial ratio calculations. We also discovered that more than half of our respondents (52%) rely on personal equity (real estate, credit cards, savings, etc.) to finance their business. T he solution? Working with a Business Banker to develop and manage cash flow. I ve been using credit cards and my own money to supply working capital. Is that the best option? Credit card interest rates are much higher than conventional commercial financing. That will drain your company of working capital; using personal credit cards will drive down your credit score. And while using your own cash is a low-cost solution, it can cost you peace of mind and security. These are things to think about when comparing credit cards to a line of credit. Using my line of credit to buy equipment is easy. But is it a good idea? A line of credit is an easy answer for a quick purchase or bridge financing. But ask yourself these questions: Can you pay it off within 12 months? What if there s not enough to cover the purchase? What if you can t convert it to a term loan? Talk to your banker about the advantages of a term loan so you can save your line of credit for when your business is hungry for external working capital.

5 It s your nest egg. And it s your future. This is what we know about your planning for the future and how we can help. We need to plan and protect Our solutions Do you have a business succession plan? more than 40% don t have a plan»» 30% have a plan»» It s time to plan and protect your wealth Women business owners worry about the future; theirs and their business. Understanding your succession plan is essential not only for the business s growth but the future.»» 23% don t plan on passing their business on T he solution? Plan to save, make prudent investments and have a holistic plan. Understand long-term goals and succession risks If your long-term goals involve transferring your business, constantly re-evaluate whether that person is able and willing. What training is needed? When do you start to transfer the business? And if you re retiring, how and when do you phase yourself out? Every woman s long-term goals are different, and they often evolve and change. Communication is key Talk to you financial advisor annually to discuss your succession plans and any changes that may have occurred. Even though you might not meet with your accountant or lawyer every year, a good financial advisor will ask the questions necessary to help determine if it s time to discuss your plans with all of your key partners. Protect yourself Women live an average of five years longer than men but when it comes to taking risks women are more conservative with their investments. Plan to save, make prudent investments and have a holistic plan so you are empowered to make smart financial decisions in every aspect of your life.

6 More than 47% of those surveyed indicated that business development was their greatest need for guidance/assistance. The greatest need for women-owned businesses: Our solutions Top four greatest business needs 47% Business Development 9% IT 8% Finances 6% Operations Networking is key Building relationships is key to growing your business. The more people you know the more people will talk about your business. Resulting in new business for you. Remember, trust and respect are the foundation of a good relationship. Tip: It s not about who you know but who knows you. T he solution? Use the relationship with a Business Banker as a center of influence. Centers of Influence How many times has a friend or colleague referred your business to someone? Those key people are your Centers of Influence (COIs). They can open doors, make introductions and be your advocate. Fostering those relationships is a great way to grow your business. COIs can be your team of advisors (bankers, attorneys, lawyers) and they can be other women-owned businesses. They promote your business and you do the same. Together you ll grow. Knowledge Networking groups are a great way to build your business knowledge. The more you know about the issues facing your profession, women-owned businesses and the region, the better you are to face those issues head on. Information can be gathered from several sources but you have to be willing to seek it in order to use it to your advantage.

7 Through our partnership with Campos Inc and Pittsburgh Magazine s Spotlight on Women in Business, we were able to reach hundreds of local women business owners to participate in this survey. About Campos Inc. It takes a village Founded in 1986, Campos Inc is a well-established, highly brand recognized market research strategy and consulting firm. We specialize in tracking, understanding and integrating consumer trends into the research services we provide to our clients. We interpret consumer trends and apply research insights to identify opportunities and create actionable business and marketing recommendations for our clients, which they then use to make timely, impactful business decisions. We offer full service qualitative and quantitative research incorporating research design, respondent recruitment, project management, moderating, data collection, analysis, and recommendations. We specialize in conducting B2C, B2B and employee research. Our top-rated downtown Pittsburgh facility, newly upgraded, features two focus group suites with full amenities. Give your business a financial upgrade. We strive to be financial partners for local businesses. Helping those who build our community build a better financial future. We do it with tools and resources ranging from remote deposits to cash vault services to practical advice. Everything business owners need to start their business and continue to grow financially. Learn more at fcbanking.com/business today. Campos Inc is a MWBE, WBENC, and WPMSDC certified company. About Pittsburgh Magazine Since 1969, Pittsburgh Magazine has been the leading magazine in the region. Built on a foundation of independent quality journalism, PM is a trusted resource for our most engaged residents and visitors. Today, our brand encompasses a monthly print magazine; a digital edition available on pittsburghmagazine.com; online videos and award-winning blogs; a free App available on ipad, iphone, Android and Kindle Fire devices; and a robust social media presence.

8 Your Resources From SCORE offices to Small Business Centers, our area is packed full of resources for growing your business. Below are just a few - check out fcbanking.com/womenfirst for more! Small Business Development Centers The U.S. Small Business Administration s Small Business Development Center (SBDC) program s mission is to build, sustain and promote small business development and enhance local economies by creating businesses and jobs. With more than 900 locations across the country, SBDCs offer existing and future entrepreneurs free one-on-one expert business advice and low-cost training by qualified small business professionals. Duquesne University Counties: Allegheny, Beaver, Butler and Lawrence Indiana University of Pennsylvania Counties: Indiana Saint Francis University Counties: Cambria, Blair, Somerset, Bedford, Huntingdon and Fulton University of Pittsburgh entrepreneur/sbdc Counties: Allegheny, Greene and Washington Saint Vincent College Counties: Westmoreland and Fayette SBA s Women Business Center (WBC) The SBA s Women Business Center (WBC) program is a network of 110 community-based centers which provide business training, coaching, mentoring and other assistance geared toward women, particularly those who are socially and economically disadvantaged. WBCs offer services online and in person. Western PA Women s Business Center: Seton Hill University E-Magnify One Seton Hill Dr. Greensburg, PA info@e-magnify.com SCORE Establish connections through programs like SCORE, a national network of more than 14,000 entrepreneurs, business leaders and executives who volunteer as mentors to America s small businesses. SCORE leverages decades of experience from seasoned business professionals to help start small businesses, grow companies and create jobs in local communities. Pittsburgh SCORE Chapter 7 Your Business Checklists Cash is Queen Save time with remote deposit and automated cash collections and disbursements services Streamline financial record processes with account reconciliation and cash concentration services Pro-actively combat fraud by monitoring accounts daily through online account information management tools and conducting surprise audits of internal processes Does your company have the necessary capital to position you for growth? Are you leveraging growth in such a way as to not operate for the monthly debt burden? Are you positioning your company to take advantage of growth opportunities? Is your company utilizing debt efficiently? Are you maximizing your company s idle cash in such a way to drive yield while maintaining solvency? Grow Your Business Relationships Seek out and develop a strong relationship with one of our knowledgeable business bankers Set up regular meetings to ensure your financial needs are being met by utilizing products and services appropriate for your ever-changing business Introduce your business banker to your accountant and/or attorney to create a cohesive advisory team who understands and is dedicated to your goals Network with the purpose of creating a circle of experts who can help you succeed Grow and Protect Your Wealth Do you have a business succession plan? Will your business be able to sustain itself when you retire? Have you named an executor of your estate? Do you have consistent beneficiary designations? Are there sufficient funds to pay final expenses and death taxes or will assets need to be liquidated for these debts? How are your assets titled? What are your investing goals? What do you want your portfolio to look like in five years? What level of risk will be required to achieve this goal? How will you assure adequate cash flow for retirement? For even more resources, visit fcbanking.com/womenfirst. Alleghenies SCORE

9 For a full report of the survey findings, visit fcbanking.com/womenfirst First Commonwealth Bank FCB Member FDIC. All rights reserved. 09/13