In the second of a series of articles investigating who’s buying and selling small businesses in America, BizBuySell investigates how gender affects motivations, relationship status and business interests.
As part of an ongoing effort to better understand todays’ business-for-sale market, BizBuySell.com recently commissioned a demographic study of individuals engaged in buying or selling a small business. The study, which surveyed more than 2,000 buyers and sellers, highlighted several trends that are shaping today’s market.
In addition to revealing how a younger, more diverse group of buyers is influencing the business-for-sale landscape, the study included gender-related insights that shed light on the role male and female entrepreneurs play in the buying and selling of small businesses.
Female Buyers Motivated by a Desire to Be Their Own Boss
Female business buyers reported a range of motivations for their interest in business ownership, but the primary motivation appears to be a desire to be their own boss, with 55 percent of women listing it as their main reason for buying, compared to 48 percent of men.
The opportunity to earn higher income and a better lifestyle were the second and third most popular responses for both men and women. Men were more likely to pursue business ownership due to their dislike of a current job (15 percent), while only 10 percent of women reported their current position as a motivating factor in their desire to become a small business owner.
Men Want Out To Buy Bigger Businesses; Women Just Want Out
Retirement remains the single most cited reason for selling a business (39 percent of men, 40 percent of women), but 16 percent (2nd most) of men list “Desire to own a bigger business” as their reason for selling vs. just 6 percent of women. The second most cited reason for selling amongst women is “burn-out” with 22 percent of female respondents selecting this option compared to 13 percent of men. Interestingly, women are two times more likely to re-enter the work force after selling their business compared to men – 16 percent to 8 percent.
The majority of sellers, both male and female, wish to remain entrepreneurs after selling their business, with 52 percent of men and 43 percent of women indicating a desire to buy another business or focus on another venture, however much more men indicate a specific desire to buy another business – 12 percent vs. 3 percent of women.
Men Retired But Bored
For many, retirement from a life-long job offers the opportunity to start a new career, one they may have always dreamed of but not had the time or money to pursue. Business ownership after retirement proved to be especially popular amongst men. In fact, 93 percent of men who listed themselves as retired also cited a desire to purchase a small business. These buyers are often looking to enter business ownership as a hobby or part-time investment.
Female Buyers, Sellers Much More Likely to be Divorced
Divorce is a common catalyst for transactions in the business-for-sale market. Many married couples share joint business ownership and are forced to make a quick decision about their future when the marriage dissolves.
In the event of divorce, many women choose to strike out on their own and reinvest their share of sale proceeds in a new small business of their own. In fact, 20 percent of women interested in buying a business listed themselves as divorced, compared to just 7 percent of men.
Women Selling Different Types of Businesses Than Men
As might be expected, men and women exhibited noticeable differences in the types of businesses they were interested in buying and/or selling. Women were much more likely to be selling businesses in the retail space (23 percent vs. 11 percent of men) and beauty salon/barber shop industry (16 percent vs. 2 percent of men).
Interestingly, women were also more likely to be listing Internet businesses. Sixteen percent of women reported interest in selling an online business compared to just 5 percent of men. Male sellers, on the other hand, were more likely to be selling restaurants (17 percent vs. 6 percent of women).
On the buy side, the male/female divide still existed, but was less pronounced as gender lines may be blurring. Female interest slightly outweighed male interest in retail (22 percent vs. 19 percent) and restaurants (26 percent vs. 23 percent). Women are still more likely to express interest in purchasing a beauty salon or barbershop, but the divide has narrowed (11 percent to 5 percent of men). Men preferred manufacturing businesses (22 percent to 9 percent of women), liquor stores (17 percent to 12 percent) and auto repair shops (11 percent to 6 percent).
BizBuySell is the Internet’s largest business for sale marketplace. Since 1996, BizBuySell has offered tools that make it easy for business owners and brokers to sell a business, and potential buyers to find the business of their dreams. BizBuySell currently has an inventory of approximately 45,000 businesses – spanning 80 countries – for sale at any one time and receives more than 1 million monthly visits. The site also features an extensive franchise directory as well as an easy-to-use business valuation tool. Please visit www.bizbuysell.com for more information.
BizBuySell was founded in 1996 and in 2012 became a division of CoStar Group, Inc. (NASDAQ – CSGP) – commercial real estate’s leading provider of information and analytic services. CoStar conducts expansive, ongoing research to produce and maintain the largest and most comprehensive database of commercial real estate information and offers a suite of online services enabling clients to analyze, interpret and gain unmatched insight on commercial property values, market conditions and current availabilities. For more information, visit www.costar.com
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