By Rieva Lesonsky
Are you ready to grow your small business in 2014? I’m glad to report that most small business owners feel the same way. A whopping 87 percent of privately held companies with sales under $5 million have growth strategies planned for 2014, reports the recently released 2014 Pepperdine Private Capital Markets Project (PPCMP) Survey.
In addition to being optimistic about their own growth plans, most business owners are optimistic about the economic outlook in general. Nearly two-thirds (65 percent) believe that growth opportunities for business will increase over the next 12 months, and more than one-third (35 percent) think that general business conditions will improve over the next year.
But while small businesses are eager to grow, those with sales under $5 million have fewer resources in terms of people and money to do so. Just 46 percent say have the resources they need to execute their growth plans, compared to 66 percent of businesses with sales over $5 million. Perhaps that’s one reason why more than half of the businesses surveyed (53 percent) plan to hire additional workers in the next 12 months.
What skills and experience are business owners looking for in their new employees? The biggest need is for sales and marketing skills (57 percent of entrepreneurs are seeking these) followed by skilled labor (45 percent) and customer service (36 percent).
Of course, there are still plenty of businesses not planning to hire. Among these, 51 percent say “economic uncertainty” is the number-one reason they’re holding back.
Small business owners also seem to be holding back from seeking financing. Of those who did seek financing in the past year, nearly half (47 percent) wanted less than $100,000 in capital. For those who did seek financing, bank loans were the number-one source they approached, followed by grants and credit unions. The success rate of those seeking bank loans was respectable, with 69 percent saying they obtained the capital they needed after approaching an average of 2.4 financing sources.
Is a lack of capital or staff holding you back from achieving your business goals? Putting your dreams on hold isn’t the only choice. Here are some options to consider:
- Can you use freelancers, outside contractors or temporary workers to staff up and down as needed, cutting your overhead costs compared to hiring employees?
- Can you partner with another small business to achieve your goals, such as by sharing salespeople or manufacturing facilities to launch a new product line?
- Can you barter with other businesses or join a barter association in order to get the products and services you need without a large cash outlay?
If you’ve got growth plans for your business this year that you can’t achieve with your current level of capital, now is the time to seek the financing you need to achieve your goals. You’ll never know until you try!