Abbigail Meeder

Carol J. Cumber

English

Research Papers in Economics

            E C O N O M I C S 
   C O M M E N T A T O R 
South Dakota State University      No. 481                       December 29, 2006 
Rural Women Entrepreneurship in  
South Dakota 
 
 
by 
Carol J. Cumber, 
Professor 
and 
 Abbigail Meeder, 
Graduate Student 
 
 
Introduction 
 
The number of women-owned small businesses 
continues to grow and add to the sustainability of 
rural economies, including South Dakota.  From 1997 
to 2004, the number of majority women owned 
businesses in SD grew by 45.6 percent to 17,833.  
Women are at least half owners in 54.5 percent of all 
South Dakota privately-held firms.  Because the 
majority of privately-held businesses in South Dakota 
are at least partially owned by a woman, the topic of 
female entrepreneurship in South Dakota is important. 
 
Studying Rural Women Entrepreneurship in 
South Dakota 
 
The number of women owned firms continues to 
increase, yet very few studies exist that concentrate 
specifically on entrepreneurship by women in rural 
areas.  This Commentator article discusses a recent 
study that focused on entrepreneurial activities by 
women in rural South Dakota in an attempt to assess 
the needs, challenges, and successes of these women. 
 
A survey was mailed to a sample of South Dakota 
rural women entrepreneurs in early summer of 2006.  
Potential participants were identified from a list 
provided by InfoUSA and recommendations by 
Extension specialists. Of 396 surveys mailed out, 110 
participants replied, resulting in a 28 percent response 
rate. 
 
Findings 
 
Some of the primary findings of the study are reported 
below. This study looked at a rural setting’s affect on 
female entrepreneurial businesses.   
 
 
 
Less than 22 percent of survey respondents felt that a 
rural setting had a negative impact.  In fact, on almost 
all factors, the majority of respondents felt that a rural 
setting had a positive impact, with 55.1 percent of 
survey respondents reporting that overall, a rural setting 
was a positive factor.     
 
The Impact of a Rural Setting on a Business 
 
 
Highly 
positive 
1 
 
 
2 
No 
impact 
3 
 
 
4 
Highly 
negative 
5 
Rural setting’s impact on:  % 
 
Availability of customers  56.2  18.1 8.6 11.4 5.7 
 
Work force availability  23.0 27.0 25.0 22.0  3.0 
 
Availability of suppliers  27.0 26.0 37.0  7.0  3.0 
 
Availability of 
technological resources  31.9 32.9 24.7  4.1  6.2 
 
Availability of training 
programs  16.7 29.2 34.4 19.8  0.0 
 
Availability of 
organizational resources  10.2 35.7 35.7 17.4  1.0 
 
Availability of financing  30.7 33.7 23.8  9.9  2.0 
 
Availability of support 
systems  22.1 33.7 31.6 10.5  2.1 
 
Social networks  16.5 29.9 37.1 15.5  1.0 
 
Overall impact of rural 
setting on business  24.5 29.6 24.5 19.4  2.0  
The impact of female ownership on a business also 
was investigated.   
 
 
Impact of Female Ownership on a Business 
 
 Highly 
positive 
1 
 
 
2 
No  
impact 
3 
 
 
4 
Highly 
negative 
5 
Impact of being 
female on : 
% 
Acquiring 
financing 
 
26.47 
 
 
19.61 
 
 
31.37 
 
 
18.63 
 
 
3.92 
 
Customers’ view 
of your business 
 
40.78 
 
26.21 
 
26.21 
 
6.8 
 
0 
   
Business sales 
 
32.32 
 
24.24 
 
34.34 
 
8.08 
 
1.01 
   
How women are 
treated as business 
persons 
 
27.72 
 
22.77 
 
30.69 
 
15.84 
 
2.97 
   
Overall impact of  
female ownership 
on business 
 
 
30.39 
 
 
23.53 
 
 
37.25 
 
 
5.88 
 
 
2.94 
 
The majority of survey participants found that being 
female had a positive impact on customers’ view of 
their business, business sales, and how they were 
treated as business persons.  Forty-six percent felt that 
being female had a positive impact on acquiring 
financing.  The majority of participants, 53.9 percent, 
felt that the overall impact of being a female business 
owner was positive.   
 
Business characteristics of rural women owned 
businesses were investigated  The most common 
industry (nearly 34%) was retail trade, followed by 
professional, scientific, and technical services (23%), 
and health care and social assistance (8%).   Over 27 
percent of survey participants had gross annual sales 
in excess of $90,000.  Almost sixty-eight percent of 
these businesses targeted a local market, and nearly 
23 percent targeted a regional market.  Only about 
nine percent targeted a national or international 
market.   
 
Several factors leading to the success of rural women 
business owners were identified.  Hard work was 
found to be the most important factor that leads to 
success (28%).  Having a drive or passion for the 
work a business person is doing ranked second (16%). 
This was followed by the importance of an owner’s 
prior experience in the area of business they now 
operate (11%).  In relation to the characteristics 
successful business women exhibited, helping others 
was most frequently selected, followed by 
contributing to family income, and making a profit. 
 
The study also looked at the use of support and 
informational resources like the Small Business 
Association, Women’s Business Center, Cooperative 
Extension Service, adult education classes, seminars, 
training programs, formal university programs, and 
online information.  Almost 54 percent of business 
owners used support or informational resources 
before opening their business.  Over 69 percent used 
these resources after opening their business. It’s 
interesting to note that although only a slight majority 
of owners used support or informational resources 
before opening their businesses, when asked about 
needs of rural women business owners, an 
overwhelming majority expressed training programs 
and personal support systems as basic needs. 
 
 
 
Needs of Rural Women Business Owners 
 
 
Very high 
need 
1 
 
 
2 
 
 
3 
 
 
4 
No 
need 
5 
 
Need For: 
 
% 
 
Training Programs                  
 
34 
 
22 
 
37 
 
5 
 
2 
 
Personal support systems       
 
65 
 
21 
 
10 
 
2 
 
2 
 
Institutional support systems 
 
18 
 
25 
 
34 
 
17 
 
6 
 
Governmental support systems 
 
26 
 
26 
 
31 
 
11 
 
7 
 
Qualified workers                  
 
49 
 
25 
 
18 
 
1 
 
6 
 
Sources of financing              
 
43 
 
31 
 
19 
 
3 
 
3 
 
Building/rental space             
 
27 
 
31 
 
29 
 
7 
 
7 
 
Local services                
 
19 
 
38 
 
32 
 
7 
 
4 
 
Mentors                                  
 
29 
 
23 
 
29 
 
11 
 
8 
 
Supportive public policies 
 
22 
 
32 
 
31 
 
10 
 
4 
 
A contact list or directory  
 
11 
 
32 
 
36 
 
12 
 
8 
 
Youth and adult entrepreneurial 
education programs           
 
11 
 
27 
 
34 
 
21 
 
6 
 
Access to institutional resources 
 
12 
 
20 
 
45 
 
16 
 
6 
 
Willingness to take a risk    
67 
 
15 
 
13 
 
3 
 
1 
 
  
Summary  
 
The overall objective of this research was to evaluate 
how a rural setting affects South Dakota female 
entrepreneurial businesses, to identify business 
characteristics of female owned rural businesses, to 
identify the factors that lead to the success of rural 
women entrepreneurs, and to identify the biggest 
business needs of rural women entrepreneurs. 
 
Although some previous studies suggested that a rural 
setting would negatively affect businesses, our 
findings were the opposite in that less than one-fourth 
of the respondents felt that was the case. Most survey 
participants stated that being a female rural business 
owner either had no impact on their business or was 
positive.  As expected, operating in the retail industry 
was most common, as was the finding that the 
majority of businesses had under $100,000 in gross, 
annual sales, and targeted a local market.  The three 
factors considered most important to the success of 
these businesses were hard work, drive/passion, and 
prior experience.  The three most important 
characteristics of successful business women were 
helping others, contributing to family income, and 
making a profit. 
 
This research also sought to identify the needs of rural 
female entrepreneurs in South Dakota.  The need for 
the following items was found to be very high:   
training programs, personal support systems, qualified 
workers, sources of financing, mentors, and a 
willingness to take risk.   
 
Survey respondents were enthusiastic in their support 
of this study. Especially telling were voluntarily 
submitted comments such as: “I feel honored to be 
included in this study! It’s been amazing.”; “I truly 
believe there are basic opportunities in rural SD – for 
women and for men. The challenge is always turning 
those ideas into plans and then the plans into 
action…turning vision into reality. Where do I sign 
up for the course on how to do that?” A particularly 
supportive comment for rural SD is from the rural 
woman entrepreneur who asserted that, “I could truly 
be affluent in any city/town in the world, but I 
consider myself very lucky to be able to continue to 
live and raise my family in a small town here in South 
Dakota. I would not have it any other way.”  Forty-
one survey respondents (37.2%) requested to be 
included in any follow-up studies. 
 
 
******************************************** 
ECONOMICS COMMENTATOR 
******************************************** 
Economics  Department     
South Dakota State University            Phone: 605-688-4141 
Box 504   Scobey Hall               Fax:   605-688-6386 
Brookings, SD 57007-0895     E-Mail: Penny.Stover@ sdstate.edu 
 
325 copies of this newsletter were produced at a cost of less than $100 
 
 
 
 
 

Rural Women Entrepreneurship in South Dakota

http://repec-sda.sdstate.edu/repec/sda/pdf/Commentator/No481.pdf

Rural Women Entrepreneurship in South Dakota

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