In this Q and A with Jennifer Cooke, Corporate Lead of Women’s Business Strategy at EDC, find out why more women need to take their companies global, and how they can do it. You also won’t want to miss EDC’s free webinar, Women take business beyond borders. Be sure to register for it here or at the end of this story.
Q. EDC wants to help more Canadian women export. Why?
A. Based on what we know in Canada, women are starting businesses at a faster and faster rate every day. But they are still vastly underrepresented when it comes to ownership of Canadian companies. Only 16% of Canadian small-to-medium-sized businesses (which we call SMEs) are owned by women. Not a big number.
Of those SMEs, only 11% are exporters. So why are so few women entrepreneurs exporting? That’s a very good question because there are many opportunities for women to start and lead more high-growth companies and scale their businesses through exporting.
Last year, EDC was proud to announce a $250-million envelope, as part of the federal government’s budget to further support Canadian women-owned and led companies to grow their businesses through exporting.
Q. What challenges do women face going global and how can EDC help overcome them?
A. Fear of the unknown can be debilitating, especially when it comes to exporting. What are the business regulations in your target market? Who is your competition and how can you reach new customers? Without the proper knowledge and skills, women have less confidence in their capabilities to handle risk and unknowns such as how to enter a market effectively.
The second challenge is connections. Women often lack the networks to help access potential customers, partners and suppliers. At EDC, we have the business connections, trade partners, and relationships with other women-focused organizations to support and empower more women entrepreneurs through all stages of their exporter journey.
And the third challenge is financing. Women tend to shy away from taking on debt or leveraging debt as a tool to scale and grow their business. They prefer to self-finance, severely hampering their growth potential. When they do take on debt, they often don’t ask for enough to manage their medium- or long-term needs and often pay it back quickly, again limiting their ability to scale. Helping them understand how to leverage financing to expand their reach and audience is key.
Q. What are the biggest misconceptions about exporting?
A. As EDC’s Corporate Lead of Women in Trade, I’ve talked to many women entrepreneurs and what I’ve observed in my conversations is that there are many misconceptions about exporting. Some think it’s only for large, multi-million-dollar enterprises; others believe international trade is limited to companies that make and ship goods across the border. That’s just not true. With new distribution methods and technologies, even the smallest companies or those that provide services can reach new markets more easily than ever before.
Another misconception is that women are more averse to risk than men. That is also not true. Women just approach risk differently. They want to fully understand what the risks are, how to mitigate them and the impacts they could have on their business before they make any decisions.
Q. What are the benefits to exporting?
A. There are many rewards that come from going global and faster growth is just one of them. Research shows companies that exporters tend to stay in business longer, they’re more profitable and by virtue of what they do, they’re more innovative.
Q. Does trade diversification boost business growth?
A. When it comes to trade diversification, it’s important to understand that exporting in general offers many benefits to Canadian companies. Being reliant on a single market can be risky and there are also many profitable markets outside of North America that Canadian companies can explore.
Diversifying their exports and having clients in different markets can be a way to decrease risk and bring more stability and grow their business. The rise of the digital economy allows Canadian SMEs to break out and serve global customers more easily and efficiently and the new free trade agreements negotiated by Canada open new markets and level the playing field for Canadian businesses abroad.
Q. How can exporters diversify their markets?
A. There are different ways that a Canadian company can diversify their markets. One way is to integrate themselves within the supply chains of their current customers, following them to new markets wherever they go. Supplier diversity is a means to provide more market access for traditionally underrepresented suppliers to opportunities with large corporate or public procurement entities.
Q. What is the recipe to export success?
A. Knowledge and preparation are key:
- Invest research and time to find global opportunities and to identify long-term potential. Find who your competitors and customers are, and which countries want your products. Determining your value proposition is key.
- Invest the time to understand the culture where you’re doing business because a lack of cultural awareness could make or break a trade deal.
- Even more importantly, make sure you have enough working capital and the right people on your team to follow through on your export plan. If you don’t have access to capital, it can be difficult to grow.
Q. What supports are available for women entrepreneurs thinking of exporting?
A. There are so many resources available to women businesses, but the challenge is knowing who to speak to, for what, and when.
Innovation Canada, for one, has a great website where you enter some information about your company then they give you a list of resources applicable to you.
But women need to feel encouraged to reach out for help, for example, with how to grow their business. It’s really crucial for each of us in this ecosystem supporting women entrepreneurs to also be aware of what supports are available for them, and to actually make those personal introductions and connections to the right people at the right time who can help them scale and grow their business.
Q. Is there anything we can do?
A. Women need to be inspired. They need examples of what success looks like and the more we can profile successful women-owned businesses that are scaling and growing their businesses internationally, the more confidence women will have to be daring and dream big.