SAN FRANCISCO, Oct. 15, 2021 /PRNewswire/ -- As we celebrate Hispanic Heritage month this year, it's a good time to recognize the many contributions of Hispanic small business owners. And there truly are many. Wells Fargo served as lead sponsor of the Latino Donor Collaborative's U.S. Latino GDP Report, which tracks the growing influence of the Latino community within the U.S. economy, and the results are incredibly promising. Latinos contributed $2.7 trillion to the U.S. GDP in 2021, equivalent to the seventh largest economy in the world, and they're growing 57% faster than the U.S. economy overall. From 2010 to 2019, the U.S. Latino GDP was the third-fastest growing among the 10 largest GDPs in the world, with the U.S. economy ranking fourth. Latinos are also accounting for 68% of the growth in U.S. labor participation. These figures are due, in large part, to Latina business owners. In fact, as of 2019, Latina women owned 18% of all women-owned businesses1, and between 2014 and 2019, Latina-owned firms grew 40%.2 These are significant numbers and show the impact Latina business owners are making on the country's overall economy.
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But we all know, small business owners have continued to struggle to stay open given the pandemic's repercussions and continuous fluctuations. While the statistics surrounding Latina-led companies are sobering – twice as many Latina-owned companies experienced closure during the COVID-19 pandemic compared to their male counterparts (30% vs. 16%)3 – the below tips can help aspiring Latina entrepreneurs stay on a path to success.
Develop a business plan
Having a good idea is NOT enough! Developing a business plan* is the first key step for any business owner. An effective plan can help you prioritize how to spend your time and money, and set measurable goals. It also can help identify current or future obstacles so you can better anticipate and avoid potential risks. For example, with COVID-19 impacts, you may have had to create more online offerings or enhance your digital presence for your business. Some of you may have had to change relationships with supply chains and vendors or reduce hiring. Whatever it was, now's the time for you to review how you've adapted to the current situation, which of these adaptions you want to build upon in the future, and then document it in your plan.
Get mentorship support
Latinos are increasingly in advantageous positions to start their own businesses—they're younger, with higher educational attainment: Nearly 90% of Latino Post-Millennials are high school graduates. They're contributing to the labor force in greater numbers, buying more homes, and closing the wealth gap at a rapid rate. But the past year and a half has reinforced what we've always known: It takes a village. As women business owners continue to climb out of the pandemic impacts, and build from survivability toward recovery and opportunity, connecting with mentors and other experts is one of the most powerful and greatest ways to exchange knowledge, share best practices, and learn from each other. Wells Fargo recently partnered with the Nasdaq Entrepreneurial Center where women entrepreneurs can gain complementary support through its signature Milestone Mapping Coaching Circles*, a 12-week long mentorship program to help them overcome key business challenges while developing a peer support network and connection to mentors. Women business owners who are interested may apply to participate, and upon acceptance, will be placed in a circle.
Find the right guidance and information
Many women may not know where to turn for trustworthy information to support them with critical business decisions. The good news is there are many free resources and tools* to help educate women business owners. The SBA.gov* website is another great place to start. It even offers a version of its site in Spanish. Additionally, the Minority Business Development Agency connects women to resources, events and opportunities to help them succeed through its Enterprising Women of Color Initiative*. Last, the U.S. Hispanic Chamber of Commerce (USHCC)* has more than 200 local chapters designed to support ambitious Hispanic business owners and also has specific Latina entrepreneur programing.
Once you've got a business plan, are connected with mentors and other experts, and have done your research, getting credit ready will be a critical next step before obtaining business financing. It's important to work with a bank that offers tools and resources that make financing easier to understand, and a banker who shows you what your business needs in order to get approved for a loan. Before applying for a small business loan or line of credit, your bank will want to see that your business generates steady cash flow, has low levels of debt, and is in a strong financial position in order to manage debt payments. The more you know about what bankers want to see in a credit application, the more prepared you will be to pursue credit for your business. A business plan also may help you obtain business financing. For example, for an SBA loan and some larger business loans and lines of credit, lenders may require a formal written business plan before extending credit.
By creating or updating a business plan, looking into mentorship opportunities, increasing knowledge, and getting credit ready, more Latina entrepreneurs can achieve success.
1 2019-state-of-women-owned-businesses-report.pdf (q4cdn.com) (English only)
2, 3 Key Insights from the 2020 State of Latino Entrepreneurship Report | LatinasinBusiness.us (English only)
*Links only available in English
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SOURCE Wells Fargo