Small Business Outlook

Date posted: May 15, 2014

By Rieva Lesonsky

This seems to be the survey season. I’ve been getting thousands (okay, I’m exaggerating a bit) of emails a day touting various surveys and data points about small business. There’s a lot of value in the information, so, in honor of Small Business Week, I thought I’d share it with you.

Here’s a taste of what’s going on in our small business world:

Read All About It

Sanjay Singhal, the CEO of Audiobooks.com passes along his picks for the top business books:

7 Habits of Highly Effective People, by Stephen R. Covey: One of the most influential books on management of all time, Covey’s guide to achieving objectives by upholding core principles has sold more than 15 million copies in 38 languages worldwide.

How To Get What You Want, by Zig Ziglar: A classic argument for goal-setting that delivers broad strategies and practical tactics to achieve success along with a generous dose of inspiration, this book was written by one of the most accomplished salesmen and motivational speakers of all time.

One Thing You Need to Know, by Marcus Buckingham: This primer on excellence in business management and leadership reveals the fundamental insight that drives achievement and provides real-world examples that illustrate how the “one thing” drives career success.

Lean In, by Sheryl Sandberg: A practical guide to leadership for a new generation of women executives, this book, authored by Facebook’s COO, examines the challenges women face in the executive suite and outlines practical solutions for overcoming barriers and finding success.

Contagious: Why Things Catch On, by Jonah Berger: A compelling examination of what makes stories, rumors and content go viral by a Wharton School professor, this book illuminates six insights that make ideas contagious across multiple social transmissions.

Big Data: A Revolution That Will Transform How We Live, Work and Think, by Viktor Mayer-Schöberger and Kenneth Cukier: This insightful examination of the hottest concept in business sheds new light on how Big Data is driving business and social policy – and endangering privacy.

The Lean Startup, by Eric Ries: With practical tips on how to create a sustainable business and overcome uncertainty, this book provides a fresh look at a startup strategy that is gaining popularity worldwide, from companies launched in a founder’s garage to Fortune 500 ventures.

To Sell Is Human, by Daniel Pink: An innovative look at the art and science of selling, this book outlines principles that are extremely valuable for entrepreneurs, managers, employees, parents, teachers – anyone who has to persuade others to take action, which is virtually everyone.

The Power of Habit, by Charles Duhigg: A 60-week New York Times bestseller by a Pulitzer Prize-winning author, this book examines the science behind habits and how people can harness that power to be more productive and successful.

Best Cities for Startup

Thinking of starting a business? According to WalletHub, here are the top 5 cities for business startup:

  • Jacksonville, FL
  • Fayetteville, NC
  • Augusts, GA
  • Jackson, MS
  • Memphis, TN

 

Moms Rule

Are you a mom business owner? Then you’ll be interested in a survey from Manta showing 66 percent of moms who own businesses don’t have nannies, babysitters or housekeepers helping them out on a daily basis. As a result, 91 percent of the women say they’ve mastered multi-tasking and organization, 85 percent have conquered delegation and 80 percent rule when it comes to problem-solving.

Sign of the Times

Over 50 percent of business owners believe in-store signs and graphics are an effective way to attract customers. In fact believe clever signs are “one of the most effective marketing tools for growing their small businesses.” But, reports a survey from FedEx Office, while most Gen Y entrepreneurs greatly value creativity in their signs and graphics, Baby Boomer business owners (age 55+) prefer simplistic designs. In fact, Boomers are more likely to use signs (45 percent) than more traditional marketing elements like direct mail (34 percent) or brochures (39 percent).

Millennial business owners are more likely to use banners, window clings or posters and prefer. They’re also drawn to colorful signs and “intelligent humor.”

Bank On It—Not

Only 45 percent of entrepreneurs in SurePayroll’s monthly survey of small businesses with 10 or less employees, plan to turn to a bank for loans, while 36 percent will use non-bank alternatives; and 7 percent will go to friends and family. Two years ago 62 percent went to a bank for a loan, and only 13 percent chose an alternative lender. What’s the reason for the shift? Well, according to the most current Biz2Credit Small Business Lending Index, the approval rates at non-bank alternative lenders are above 60 percent, three times more than that of big banks.

Doing More With Less

That’s become somewhat of an entrepreneurial mantra, or so indicates new survey data from Constant Contact. Almost 40 percent of small businesses reported 2013 revenues increased at least 10 percent over 2012, despite the fact that 65 percent made “concessions, such as cutting operating costs and marketing budgets, due to economic pressures.” In spite of (or maybe due to) this, the overwhelming majority (81 percent) of business owners are feeling optimistic, and expect an even better 2014, with 13 percent of them expecting a sales increase of more than 25 percent.

The survey also shows marketing is now a top priority. Most of the businesses work on marketing activities 20 hours per week. More than 80 percent have adopted multi-channel marketing programs, using a combination of channels, such as email, mobile, and social media to reach their customers.  And 73 percent their say their efforts have been successful, leading to more customer engagement (73 percent); more new customers (57 percent); increased website traffic (54 percent) and higher revenues (40 percent).

But not everything was rosy. Almost 60 percent didn’t know if their customers were using all their channels, 35 percent didn’t know how to measure success and 32 percent thought it was too time-consuming to get it all done.

Risky Business

A survey of SMB IT professionals from Carbonite reveals the dangers of data loss for small businesses. More than 60 percent of the IT pros had already experienced the pain of losing data, and one-third say their companies lost money as a result. Other negative impacts of losing data include problems with work/life balance, company moral and job loss.

And what’s worse, even though they acknowledge how vital backing up data is, only 32 percent had backed up company data that day and 15 percent hadn’t back up their data for at least a month.

Want to know more? Download The 2014 Report on the State of Data Backup for SMBs for free.

Pack Up!

Small business owners believe travel is “critical” to helping them forge better business relationships and find new clients and customers. According to the Expedia Small Business Report, 52 percent of small businesses owners say travel is a “very important” part of their success.

While on the road, more than 50 percent rely on their smartphones, while one-third swear by their laptops. Most (81 percent) try to eat healthy and 52 percent hit the gym in their hotels.

What do they hate about traveling? Their top three complaints (mine too) are a lack of Wi-Fi on their flights and in their hotels, delayed or cancelled flights and long security lines at the airport.

I Feel Good

The newest Wells Fargo/Gallup Small Business Index says the small business owners are feeling positive. In fact “overall, optimism has reached the highest level in six years.” Why is everyone feeling so good? The report says small business owners are feeling “more positive about their abilities to obtain credit” this year and are planning to increase their capital spending over the next 12 months.

They’re not only optimistic, they’re “satisfied” with their lives as business owners, and 92 percent 92 percent feel “somewhat, very or extremely successful.”

Bank of America also reports small business owners are feeling optimistic. According to the spring 2014 Bank of America Small Business Owner Report, 51 percent of small business owners feel confident about their local economies and 52 percent plan to hire in the next year.

And the business owners will likely be there right beside them. According to the report, entrepreneurs are more likely to put off retirement. Of the business owners over age 56, 71 percent plan to retire after they turn 65, or until they are physically unable to work.

The downside? Only 41 percent of the business owners older than 56 have a succession plan, mostly because they “don’t have a successor” (46 percent) or aren’t ready to give up control of their businesses (18 percent).

Oh My Precious

When you think about the things you spend a lot of money on as a business owner, chances are that printer ink doesn’t pop into your mind.  Well, think again. According to the folks at Cartridge World, on a per gallon basis, printer ink ($6,500 a gallon) costs more than a gallon of gas (which we’re constantly complaining about), champagne ($277 a gallon) or human blood ($1514).

In fact, on average it will cost you $94 to buy a new inkjet printer and $500 a year for the ink cartridges.

Getting Social

In its “Small Business Digital Usage Survey,” Webs, a subsidiary of Vistaprint, reports that 63 percent of small business owners are “actively using digital products to market their businesses. Most (88 percent) of those with social media profiles say Facebook is their top social media marketing channel followed by LinkedIn (39 percent), Twitter (31 percent), Google+ (22 percent), Pinterest (20 percent) and YouTube (17 percent).

Full Steam Ahead

And finally, in its newly released Semi-Annual Small Business IndexRocket Lawyer reports business is booming for 56 percent of small businesses, with 47 percent planning to hire full-time employees within the next six months. In all, 70 percent of the entrepreneurs believe the second half of 2014 will be stronger than the first part of the year.

Of course not everything is smooth sailing. Attracting new business is an issue for 42 percent of the business owners, while 25 percent struggle with marketing issues and 24 percent are concerned with maintaining profitability.

Rieva Lesonsky is CEO of GrowBiz Media, a media and custom content company focusing on small business and entrepreneurship. Email Rieva at rieva@smallbizdaily.com, follow her on Google+   and Twitter.com/Rieva and visit her website, SmallBizDaily.com, to get the scoop on business trends and sign up for Rieva’s free TrendCast reports.

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