Category Archives: Commerce

As the wants and needs of modern life change, so do the ways people spend their money — from the companies they support, to their entertainment choices and when they choose to buy a home.

Single female seeking … real estate

Despite tightened lending conditions, single women are still outpacing their single male counterparts in buying homes.

In 2009, single females made up more than one-fifth of the marketplace and single males made up about one-tenth, according to the National Association of Realtors. In 2010, single women jumped to 26 percent of all home purchases in the Chicago area.

“In recent years, that has declined,” said Jessica Lautz, manager of member and consumer survey research at the National Association of Realtors. “I believe part of that is because of credit conditions in the country that we’ve seen in recent years.”

In 2013, single females made up 16 percent of home buyers, while the share of single male buyers fell to nine percent, according to the NAR Profile of Home Buyers and Sellers.

Still, single women are only second to married couples in terms of buying power, according to Lautz. “We’ve seen that they do have a very strong desire to own,” Lautz said.

Single women out buying single men in the home buyer’s market indicates a societal shift, according to psychotherapist Dickelle Fonda.

“Women have the resources now to do it and the banks don’t bat an eye at it,” said Fonda, who works largely with women and couples at her Evanston practice. “But I can tell you that in my mother’s generation, in my day, we would have never been able to sit down with a banker and have a serious conversation about buying a house. It was unheard of.”

Fonda said she works with many single women in their 20s who are buying homes.

“It’s so second nature for them to just think about not waiting until they have a partner, just how women aren’t necessarily waiting for a partner to have kids,” Fonda said. “I’ve seen many of them who are not yet married and didn’t have to give a whole lot of thought to the fact that, practically speaking, they just wanted to buy a property, they wanted a condo, or they wanted a house. They weren’t married, they weren’t attached to anybody yet. It was just, ‘I have the money and I’m going to do it. If I end up getting married to someone who also has property, we’ll just rent one of them.’”

Karl Vogel, a Chicago real estate agent for @properties, said many of his single female clients are looking to invest. Seventy-seven percent of single female buyers view their home as a good financial investment, according to the NAR profile.

“I think a lot of women are working now and making good money,” Vogel said. “They’re not get married when they’re 20 years old. They have professional careers and assets, and part of that is investing in real estate. They’re basically buying houses before they’re getting married.”

Vogel’s two most recent single female buyers were a pilot and a lawyer.

The first, a 43-year-old French citizen, “wanted to buy a place here because it would be a good investment and she didn’t have any other real estate,” Vogel said. “My other single female client was an attorney in Northlake, and she bought a house in Winnetka. She’s a lawyer and makes a ton of money. She just had to be closer to work because her commute was too far.”

Security is a concern that sets single female buyers apart from other buyers, Vogel said.

“Single women, I think, as a whole are more safety conscious than let’s say, single men or couples,” Vogel said. “If you know your boyfriend’s there, you don’t have to worry about people mugging you or breaking into your house. But if you’re a single woman, they usually want to be on a top floor if it’s a small building, or they want a building with a doorman or security.”

Single women are more willing to make sacrifices to buy a home. More females than males cut spending on luxury items, non-essential items, entertainment and clothes in order to purchase a home in 2013.

“We grow up making sacrifices that men don’t have to make,” Fonda said. “I think we’re used to it, so if it means we have to make sacrifices in order to have the money for a down payment on a house, then we know how to do that.”

The income disparity between single female and single male home buyers may also indicate something about their spending habits. The average income of a single female home buyer is $52,000, while the average single male’s is just over $66,000.

“Women are still making considerably less than men, and yet more women are able to buy property,” Fonda said. “That speaks to the fact that either they’re better managers of their money, or they’re willing to make sacrifices that men aren’t yet willing to make.”

“Women can now be this demographic that’s able to buy property by themselves, and have the mindset that you don’t need to be attached to a man to do that.”

Adopt or die: Keys to small business success

Photo credit: Eman Shurbaji

“I like to give business to our local restaurants, coffee shops and stores. I think it’s important to support them”, said Heidi Aylesworth, a personal assistant who lives in Edgewater, Chicago. Many others people share Heidi’s sentiment.

Though many Chicagoans are willing to support small businesses, few know how important these are for Chicago, and by extension, Illinois. But how can these businesses stay profitable in today’s highly competitive economic environment?

According to Illinois Department of Commerce and Economic Opportunity, 98.8 percent of Illinois establishments have less than 100 employees, which places them in the category of small businesses. Fifty-nine percent of these establishments employ only two to nine people. In the U.S. as a whole, small businesses represent 46 percent of the total Gross Domestic Product (GDP) and provide 49 percent of the total number of American jobs.

“They are crucial for our economy and also for job creation,” said Katie Hamilton, director of small business for the Chicagoland Chamber of Commerce. Since the Great Recession of 2008-2009, the number of small businesses opening every year has increased dramatically, she said. What explains this trend? According to Hamilton, “the economy was so rough for three years and so many people were laid off, big corporations were downsizing, that people were forced to open their own business.”

At the same time, more people began thinking it would be a good idea to support local, small or family owned businesses.Also, local stores and restaurants are seen as an interesting alternative for big retail chains. “It’s not a corporate feeling when you walk in here. We try to be close to our customer, to use local sources [for the ingredients] and also to offer a more personalized menu. People value these things,” said Tracy Dahlke, owner of Unicorn Cafe, an Evanston coffee shop located opposite from Starbucks on Sherman Avenue. She sees her customized service as one of her most important competitive advantages.

tracy
Tracy Dahlke took over Unicorn Cafe in 2004, after working there for two years. “We have a loyal customer base.” Photo Credit Eman Shurbaji

Embracing technology

Using local sources, having a personalized customer service, and offering a friendly and cozy environment are ways of attracting loyal customers. However, in the actual business landscape, it’s crucial to go further in order to stay competitive. “The key tool for small business to thrive now and in the future will be knowing how to adopt and profit from new technologies,” Hamilton said.

Her opinion has an empirical basis. “Ahead Of the Curve: Lessons on Technology and Growth from Small-Business Leaders”, a study conducted by Boston Consulting Group (BCG), one of the biggest consulting companies in the world, shows how small businesses that are “tech leaders” perform better than what the study calls “tech laggard” companies.

In developed economies, such as Germany and the U.S., between 2010 and 2012, tech leader businesses experienced an average revenue growth of 17 percent. At the same time, tech laggards’ business grew only 4 percent in the same period. Those classified by BCG in between both groups, the tech followers, saw their revenues grew 7 percent.

Jimmy Odom, a serial entrepreneur, did not need to read this study, because he knows the importance of adopting technology. After running start-ups and working for Apple, he decided to start a business that would help small entrepreneurs expand their business with new technology and changing the way they operate.

He founded We Deliver, a company that turns regular people into delivery personnel for local merchants. People are sharing their time, while business owners are embracing a new technology that allows them to reach customers residing outside of their immediate location, thus expanding their client base.

Odom says that for many small businesses, location is everything. “If you don’t have a wonderful location, the success of your business might not happen,” he said. With We Deliver, he aims to help small businesses overcome this obstacle.

“There is still a great majority of local business that did not adopt technology. They are still very analogic; they use paper for everything, which means there are no records of their transactions and customers. It makes it hard to do analytics with them, for instance,” Odom said.

The good news is these entrepreneurs are aware of their weaknesses and are not resisting changing their way of doing business. “When I start working with them, they get involved and embrace the novelty because they want their business to stay relevant in the future,” Odom says.