Finance · 5 August 2015

Mum-run businesses contributing £7.2bn to the UK, capitalising on flexibility of ecommerce

Ecommerce site Etsy recently announced 86 per cent of its sellers were female
Ecommerce site Etsy recently announced 86 per cent of its sellers were female

Businesses run by mothers with children aged 18 or under are generating over £7.2bn for the UK, supporting 204,000 jobs in 2014.

According to new research from think tank Development Economics, commissioned by eBay, a look into “mumpreneurs” and their contribution to the economy, revealed that the sector is growing at an unprecedented rate.

The most popular industries for these businesswomen include retail, health and care, professional, scientific and technical and arts and entertainment.

Sarah Calcott, chief operating officer of eBay, said: “Improved connectivity and growing digital literacy is enabling ambitious, business-minded mums to realise and pursue successful enterprises.”

Using data available from the Office for National Statistics, by 2025, the mum economy will generate £9.5bn for the UK, while supporting an extra 13,000 employees. This would raise the total jobs created by businesses run by mothers to 217,600.

“These entrepreneurial businesswomen are building impressive companies, creating both wealth and jobs while also fulfilling one of the most demanding roles of all – being a mum,” Calcott added.

Of the most successful sectors for these businesses run by mothers, health and care services was top, with a £1.4bn contribution to the UK economy, followed by professional, scientific and technical services with £, then arts, entertainment and recreation bringing in £900m and retail £650m.

Online marketplaces can be appealing – enabling people to make money from a hobby, while maintaining flexibility in when they work
Online marketplaces can be appealing – enabling people to make money from a hobby, while maintaining flexibility in when they work

Thousands of firms led by mothers started on eBay as shops on its marketplace and this trend has also taken off in the US – with women making up 86 per cent of sellers on P2P ecommerce site Etsy. Interestingly, around a third of US small businesses are women-owned, according to the Institute of Women’s Policy Research.

The option to establish a business presence online has been particularly appealing for many mothers – from the Etsy research, 26 per cent of sellers had no paid employment before starting their business. Stay-at-home mothers have seen an opportunity to make use of a skill or interest and gain some money while doing so, without compromising their desire to stay at home with their children.

In the UK, Julia Rockett founded Boho Mama Boutique on eBay in 2013, selling maternity clothes and women’s clothes. She’s also a mother of four.

“One of the biggest benefits of starting up Boho Mama Boutique has been the flexibility it has afforded me, both as a parent and businesswoman,” she said. While her old job was a standard nine to five affair, the online business enabled her to plan around what she needed to do each day. The option of starting a firm then, has its appeal for both stay-at-home mothers and those who had been working.

Research from the Global Entrepreneurship Monitor found that increasing numbers of women are becoming interested in the entrepreneurial route, though the numbers who actually turned the idea into a reality were still fairly low – they were four times more likely to express their desire to become an entrepreneur than actually become one.

It seems that the option is being discussed more however, and women are seeing flexibility in opportunity, with online businesses in particular showcasing numerous draws that previous employment options may not have done. Etsy found that less than one per cent of sellers took out a loan to start their businesses – valuable for those hoping not to need financial assistance or relying too heavily on others.

UK money

Some 74 per cent of Etsy sellers were motivated to start their work because they wanted to do something they enjoyed, with two-thirds feeling doing something you’re passionate about is more important than making money.

The entrepreneurial businesswomen in the UK increased their economic “value added” to the UK economy by 30 per cent between 2011 and 2014, with the number of jobs supported by their businesses increasing by 23 per cent during that time.

With the numbers of women managing their own business and a family alongside that on the up, some feel the terminology surrounding female entrepreneurs is in itself a hindrance to further success.

Earlier in 2015, the Centre for Entrepreneurs found the majority of women didn’t identify with the word “entrepreneur” considering it a loaded term, preferring founder or business founder. With the constant acknowledgements of gender, those surveyed felt it diminished their accomplishments – as if they were successful “for a woman”.

Image: Shutterstock

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Rebecca is a reporter for Business Advice. Prior to this, she worked with a range of tech, advertising, media and digital clients at Propeller PR and did freelance work for The Telegraph.