As 2023 winds down, women and minority small business owners expect their revenue to increase in the coming year and many plan to hire more workers, according to a new report from Bank of America.
The “2023 Women & Minority Business Owner Spotlight” found that nearly half of women-owned small businesses plan to expand in 2024. The study shows 63% expect revenue growth, 74% plan to secure additional funding and 32% plan to hire more workers.
More than half of women owners surveyed say they have equal access to capital compared to 2022 (up from 48% a year ago) and 90% are modifying their daily business routines to accommodate caregiving, with a third taking time away from work due to those responsibilities.
Leah Niehaus, owner of LCSW & Associates, a Hermosa Beach business that provides mental health counseling, psychotherapy and group therapy to families and adolescents, said her operation is on an upswing.
She recently secured a $25,000 Small Business Down Payment Grant from Bank of America that’s designed to help eligible small businesses buy commercial real estate to expand. The bank also helped her get an SBA loan.
“I was able to buy the suite we’re in and also expand into the space next door,” the 48-year-old Manhattan Beach entrepreneur said. “This will expand the business from a three-therapy suite to six suites, and it will double our services.”
Neihaus, who provided a 10% downpayment to secure her grant, employs five clinicians but hopes to add two more. The expansion, she says, couldn’t have come at a better time.
“The pandemic has created a situation where more young adults and families are in need of mental health counseling,” she said. “As things shut down, there was a tremendous amount of depression and anxiety. Many people felt a sense of isolation, and people were losing their jobs and marriages were falling apart.”
During the worst of the COVID-19 pandemic, Neihaus said her employees wore masks and met with families and groups outdoors, often in apartment courtyards. Students who were forced to learn through ZOOM sessions and classroom settings wearing masks lost out on vital social interaction, she said.
“We are helping kids get connected again,” she said. “There are lingering effects, but things have improved.”
Angela Antonio, a regional executive with BofA’s small business division, said the grants have opened doors for women and minority entrepreneurs.
“We’re getting them to be more optimistic about being able to own their own commercial real estate properties,” she said. “And our SBA (loan) pipeline is the largest it’s ever been. We’re up 250% from 2021.”
The BofA report shows inflation is the top concern (79%) among women small business owners, followed by commodity prices (66%), interest rates (65%), the US political climate (65%) and the possibility of another recession (63%).
Hispanic/Latino owners
Forty-five percent of Hispanic/Latino small business owners expect their local economy to improve, down from 52% last year, and 51% plan to expand their business over the next 12 months compared with 59% last year.
Hiring expectations are also slightly lower in that demographic, with 43% planning to expand their payrolls next year, compared with 45% in 2022.
But there are bright spots.
Marisol Amavizca Evans, who owns Socal Real Estate and Management Inc. in Diamond Bar, is also expanding, thanks to a $25,000 grant from BofA’s Small Business Down Payment Grant program.
Like Neihaus, the money has allowed her to buy her own office. She’s expanding from 500 square feet to a new 1,200-square-foot location and also plans to hire more employees.
“When I was initially looking to purchase this property I was told I’d have a hard time getting a loan approved,” Evans said. “But I don’t have to pay back this grant — it’s great.”
Black owners
Black small business owners are also feeling optimistic, with 86% expecting a revenue increase in 2024 compared with 72% in 2022.
Seventy-one percent plan to expand their business over the next year 56% plan to hire more employees on the next 12 months, up from 44% last year.
BofA’s data was drawn from a survey of 1,079 small U.S. business owners with two to 99 employees and whose annual revenue ranged from $100,000 to nearly $5 million.
