Ep. 217: Female Small Business Owners Embrace Equity on International Women’s Day

IMA is celebrating International Women's Day on March 8th to commemorate the cultural, political, and socioeconomic achievements of women. In this special Count Me In podcast Yvonne Barber, CFO, HR Knowledge Source, discusses how the pandemic affected female small business owners and how some used management accounting strategies to help them become more resilient.

Connect with Yvonne: https://www.linkedin.com/in/yvonnebarber/

Episode Transcript:

Margaret: Hello, and welcome to Count Me In. I'm your host, Margaret Michaels. Every March, IMA celebrates International Women's Day. A day recognizing the unique contributions and accomplishments of women.

Embracing equity is the theme of this year's celebration. Questions of equity are prevalent when speaking about women and the workplace. Nowhere is equity defined as the promotion of justice, impartiality, and fairness. Within the procedures, processes, and distribution of resources, according to IMA's Diversifying U.S. Accounting Talent Report.

More important than in the realm of small business. Where female, small business owners account for 21.4% or 1.24 million of all small businesses in the U.S., according to the Census Bureau.

Today, I am here with Yvonne Barber, CFO of HR Knowledge Source and IMA's Small Business Committee Chair. To discuss how the pandemic affected female small business owners. And how some used management accounting strategies to help them become more resilient.

We will consider the challenges these owners face in a competitive, post-pandemic business environment. And the ways strong management accounting principles, can help them operate their businesses more efficiently and profitably. Thank you for being here today, Yvonne.

Yvonne: Thank you for having me.

Margaret: So I guess we'll start with looking back at the pandemic. Which really did bring a lot of attention to small business owners and their challenges. At the height of the pandemic, you worked for Blue Abacus Solutions. An accounting services firm specializing in small businesses. Small businesses took a huge hit during the pandemic. With quarantines, social distancing rules, and employee turnover affecting their ability to operate and stay profitable.

According to the World Economic Forum's Global Entrepreneurship Monitor, female small business owners were hit harder than men. With women 20% more likely than men to report business closures, due to the pandemic. Can you offer some perspective on why female-owned businesses were especially at risk?

Yvonne: Sure, in addition to the resource that you mentioned. I've researched this topic to develop a better understanding of the challenges faced by small businesses. So that the IMA's Small Business Committee, where I serve, can offer the support needed to the small business community.

And I found that the biggest factor to be the lack of access to funding and capital. A majority of female entrepreneurs self-fund their business. And this can limit the ability to scale their business or invest in the needed resources, to improve operations.

One of the things that small businesses, in general, struggle with is looking forward at what's coming, as opposed to reacting to what's currently on their plate. And I think that is where a lot of small businesses found themselves.

They just weren't in a position to handle what the pandemic served out to them, and that is one of the biggest factors. But among that, bias among customers was also listed as another factor.

Now, this may not be a great obstacle for some women. Especially, here in the United States, I think we've made a lot of progress in that area. But I found several studies, throughout the world, that found customers are less likely to purchase goods or services from women-owned businesses.

So there's a variety of reasons that women were impacted as they were. And I think it's difficult to offer a one-size-fits-all approach to this. I think, instead, it's good to look at each individual item. And address as it pertains to your business, as a female-owned business or a small business owner in general.

Margaret: Yes, those are great points and I think the funding issue is very top of mind. And that's really interesting, the bias, I never thought about that. But women experience bias in a lot of realms. So it shouldn't be surprising that it's also prevalent in small business ownership and customer choices. Those are great points.

Yvonne: Yes, that surprised me as well. Just because my perspective here, being in the United States, I think that we've learned to navigate that a little better. But in that The Small Business Committee, we serve a global membership. I am interested in what the challenges are for our membership. All over the world, not just here in the United States. So that was surprising to me. But it was helpful to see the information, so that I'm in a better position to offer what's needed for our members.

Margaret: And the IMA's Small Business Committee does a great job, with helping members who are struggling with these issues. In fact, IMA's Small Business Committee published two important reports, to help guide small businesses through the COVID crisis, and to help them stay resilient post pandemic.

I wonder what differentiated the businesses, who managed through the crisis versus the ones who failed? And from your perspective, why is it difficult, when you are a small business owner, to address both short-term crises and long-term strategy?

Yvonne: I think the businesses who survived focused on sustainability and leveraged strong relationships, and a diverse network of sources to meet their needs. Those who prioritized relationships were just better positioned to survive the storm. The relationships include the customers, suppliers, as well as employees. And it can be tough to think about tomorrow when you're just trying to survive another week.

I know a lot of small business owners. I know they're just trying to make payroll. But making short-term decisions that impact the long-term sustainability of a company, they may seem to help the short-term, but ultimately they do end up hurting the company.

Margaret: I think that's something that even mid and large-sized businesses grapple with, is that balance between the short-term and the long-term. And not having those short-term decisions affect your ability to operate in the long-term. So that's absolutely on point.

And now, as the immediate crisis of COVID passes, new risks are also emerging for small businesses. These include worker shortages, failure to embrace digitization, inflation, and supply chain disruptions. And without the resources that larger size companies enjoy. How can small businesses mitigate these risks?

Yvonne: &...