The end of 2019 is right around the corner and thus we’ve decided to point out certain SME Trends and Statistics that were shaping the business environment throughout the whole year, in particular, in the United States.
The information was taken from the Guidant Financial data source that has conducted research among 2,700 business owners who answered the question about the overall level of comfort and confidence they have regarding the environment their businesses are operating at.
Small business owners admitted that they are feeling quite confident and comfortable in the current political and economical climate. It is worthy to note that only 24% of all respondents rated their confidence under five on a scale from one to ten (1 being the “least confident” and 10 the “most confident”).
Moreover, research has also peeked into the level of happiness among these business owners. And turned out that about 53% of surveyed business owners ranked their happiness 9 and higher, others said they are feeling “okay, but could be better”.
Researchers managed to highlight the Top-5 Challenges for Businesses nowadays. Those appeared to be the Lack of capital or cash flow, the Marketing or advertising issues, Time management, the Recruiting or retention of employees, the Administrative work like bookkeeping, payroll, etc., and Managing or providing benefits. Of course, the on-going trading war with China might also be the reason for the US business owners’ headaches in 2019.
While the American unemployment rate has reached its 49-year lowest level, the small business owners are struggling to recruit a suitable employee. Therefore, small business owners admitted that there is a 15% increase in challenges connected with recruiting and retaining employees.
Similarly, the lack of capital or cash flow is a major challenge for entrepreneurs which might often be followed by trouble with marketing and advertising, administration work, and lack of or poor time management.
Who are those business owners nowadays?
In 2019, small businesses are continued to be controlled by the boomers. There is little difference between the levels of education of those who are managing the businesses – about 33% are High School graduates, 29% have Bachelor’s Degree and only about 4% have Doctorate.
What is more, even though the overall level of sexism is gradually decreasing, the majority of business owners are still men (about 73%) and only 27% of those are women.
The main business industries
The two most popular ones are Business Services and Food/Restaurant business. After those go the Health/Beauty/Fitness businesses, and only after – General Retail and Home Services. Notably, the Health/Beauty/Fitness business started its growth in early 2018. And a huge increase in these industries this year might be attributed to the growth in customers’ consciousness and knowledge of the services and products offered.
Forms of financing the businesses
Even though everything seems to be similar to what it was the previous year, there are some shifts in formerly less-utilized forms of financing. Thus, the stare of mortgage refinancing grew by 33%, SBA loans increased by 29%, HELOC grew 27%.
Yet cash still remains the most common funding method with 32% of business owners resorting to it. Rollovers for Business Start-Ups (ROBS), or also known as 401(k) Business Financing, has 13% of business owners opting for this form of financing. Frankly speaking, there are many benefits to such a funding method, funding the businesses without tax penalties or interest rates is one of them. Of course, we cannot forget about the now new method of funding – IPOs that have shown the benefits they can provide to the companies that went public.
As the economy continues stabilizing and even growing, as well as the consumer spendings, small businesses are thriving and blossoming. The high number of business owners who are stating they are feeling happy and secured only proves it.