Women possess the potential to create an extra 150,000 new companies every year and hold the key to recovery

By Helen Loveless
Last updated at 12:13 PM on 09th March 2009

Today is International Women’s Day, when the economic, political and social achievements of women are celebrated.

Yet many still face barriers preventing them from setting up in business, even though entrepreneurs are widely seen as the driving force behind any economic recovery. Experts are keen to encourage women to take a more active entrepreneurial role to help the UK out of recession.

Female entrepreneurs contribute an estimated £130billion a year to the UK economy, yet figures show that if as many women as men launched businesses there would be an extra 150,000 start-up firms every year.

In the bag: Ida Horner says women are good networkers

Glenda Stone is co-chairwoman of the Women’s Enterprise Task Force, which was set up by Gordon Brown to increase the number of successful, female-run businesses. She believes lack of confidence is a key factor deterring many women.

‘The majority of women-owned firms are micro-businesses and this is partly because many women don’t have the confidence or knowledge about where to go for finance, or how to take their business to the next level,’ she says. ‘Women’s enterprise is vital in helping the economy to move forward.’

The natural caution of many businesswomen may also be holding them back, says Stone. ‘Women often achieve more than men with less money because they are less inclined to borrow,’ she says. ‘However, this can lead to them not being properly resourced, which can hold them back.’

But one area where women shine is social enterprise. According to the Social Enterprise Coalition, while men are twice as likely as women to set up a ‘ conventional’ business, women are more likely to launch a social enterprise.

Uganda-born Ida Horner started Ethnic Supplies, a social enterprise specialising in handicrafts, textiles and arts and crafts from east Africa, in 2007.

Ida, 43, from Walton-on-Thames, Surrey, had been a housing manager for a London borough, but after visiting Uganda and witnessing the extreme poverty there, she decided to set up her business. Ida imports Fairtrade textiles from Madagascar and baskets and jewellery from east African states including Uganda and Kenya.

‘A key motivation for starting my business was to support women in east Africa and enable them to work,’ she says.

So far Ida has financed the business through the equity in her home and from savings. She has also received help from advice service Business Link. Family and friends help out, too.

‘Women are good at networking and mentoring, and having access to this has helped me to see where I can develop,’ she says.

To contact Business Link, go to businesslink.gov.uk. Women can also approach Addidi Business Angels, which invests in SMEs run by women (addidi.com).