Small-Business Owners Optimistic about Growth
NEW YORK -- The majority of small business owners -- 58% -- expect to see their companies grow within the next 12 months. Increasingly, they're realizing the importance of new forms of marketing and advertising, a study conducted in behalf of CAN Capital finds.
"While a majority of small-business owners are optimistic about growth, we are seeing concerns about being able to access needed capital, keeping up with new trends in mobile and digital advertising, meeting new regulatory requirements, and winning the war for talent with larger competitors," said Daniel DeMeo, CEO of CAN Capital, which recently released the results of its quarterly Small Business Health Index.
"At the same time, there is an appetite for expanded marketing efforts, hiring and investments in inventory, equipment and technology. Our survey aims to provide insight into the challenges and opportunities that exist in the marketplace and shine a light on potential solutions that will help businesses achieve their growth goals," he said in a prepared statement.
Small businesses increasingly are realizing the importance of marketing and new advertising venues. Survey data show that 38% of small businesses are looking to expand and/or try newer venues, such as online and email ads, within the next year, up from 31% last quarter. And, 30% cite digital advertising as very or extremely important.
While many small-business owners try advertising through the Internet, they’re unsure about how to go about it, 39% saying they have not updated their businesses' websites for all mobile devices. Only 31% cite social media (such as Facebook ads) as being very or extremely important to their growth strategy.
More than a third, 35%, say their growth plans include purchasing equipment and/or making inventory investments, up nearly 10 percentage points from last quarter. Twenty percent plan to hire more people and another 20% plan to implement new technologies or operational tools such as a customer relationship management system.
Regarding consumer trends, 41% cited mobile and/or online business reviews as having the biggest impact on their small businesses. This was followed by online shopping, cited by 34%. Despite the increased popularity of online shopping, more than half do not accept payments online.
More than two-thirds of owners said they faced challenges increasing their businesses over the past year. However, no one challenge stood out.
When competing with big businesses, small-business owners said offering competitive prices was the biggest challenge, with the ability to offer their employees competitive benefits coming in second. These were also the top two concerns of small business owners last quarter.
Applying for a bank loan was cited by 34% as the easiest way to obtain funding/working capital, making it the top option again this quarter. However, for the second consecutive quarter, loans from friends and family were cited as the No. 1 way respondents have secured funding/working capital. In this latest survey, 49% said they secured funding this way, up from 40% last quarter.
Published by The Business Journal, Youngstown, Ohio.
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