Mixing It Up

They may not have the numbers yet, but women are making waves in the traditionally all-boy world of franchising.

Is a woman's place in franchising? It didn't seem that way in years past. The disproportionate lack of women in franchising was apparent everywhere from franchisors' executive offices to franchisee-owned locations.

Even Dina Dwyer-Owens, CEO and president of The Dwyer Group, wasn't immune to the problem. When she was appointed acting CEO, some franchisees campaigned against her, because they didn't think a woman should be in charge of a corporation focused on such traditional male occupations as plumbing and electrical work.

It's still an issue among The Dwyer Group's 1,400 franchisees. Dwyer-Owens estimates only 10 percent of franchise agreements include a woman's signature, although many franchises are run by husband-wife teams where the woman controls business operations and the man handles fieldwork.

Why the discrepancy? "Competence," says Dwyer-Owens. "A lot of women don't believe they have it, or they're afraid to prove they have it. They're afraid to get out of their comfort zone."

According to the most recent data-a 1999 study by private consulting firm Women in Franchising (WIF)-the number of women-owned franchises is not increasing proportionately to the increase of women-owned companies in general.

In addition, WIF found that the female franchise ownership percentage rate decreases as franchise cost increases. "There's not so much of a glass ceiling keeping women from purchasing a franchise as there is a green ceiling-money," says Samuel Crawford, a WIF senior franchise consultant and author of the study.

Crawford believes that financial ceiling may be related to the way women typically start businesses. "A lot of women start with little or no money and use their earnings to grow the business," he says. "But that's typically not a growth strategy that works."

While Crawford attributes this common mistake to lack of business savvy, it may also reflect many women's conservative fiscal nature and limited financing options. According to reports by the National Foundation for Women Business Owners (NFWBO), while women own 38 percent of all U.S. companies, they receive less than 2 percent of venture capital. And although access to capital is increasing, NFWBO found the amount of credit granted to women still trails that of men.

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This article was originally published in the November 2001 print edition of Entrepreneur with the headline: Mixing It Up.

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