Survey: What Worries Small Business Owners Most
US small businesses are optimistic about their business prospects, but are concerned about the economy and what the future will bring. So reveals the second release of Sage Business Index, an international business outlook survey by The Sage Group, a leading provider of business management software and services to small and midsized businesses worldwide. According to Sage Business Index, American business owners continue to be optimistic about the prospects for their businesses but are growing concerned about the country’s economy as a whole.
Sage Business Index found that, on a scale of 0-100, where 50 is neutral, values above 50 reflect optimism and those below 50 denote pessimism, business owners have a confidence index at 55, when asked about their business prospects in the next six months. Confidence in the US economy as a whole, however, was more negative at 41.57, a drop from 50.75 when the first Sage Business Index was conducted in February 2011.
Findings showed that confidence differences exist based on the size of the business and small businesses are the least confident about what the future holds.
These results are far from meaning that the small business community doesn’t trust the American business sphere. On the contrary, surveyed small businesses saw many favorable aspects in doing business in the US, particularly the American business culture and entrepreneurial spirit that characterizes its people, which 59 percent of respondents favored the most, followed by having a skilled workforce to recruit from (46 percent) and access to a strong domestic market (41 percent).
However, those same businesses are concerned about the bureaucratic barriers they will face.
Survey respondents cited government and bureaucracy as the biggest problem they have to surmount when doing business. Government’s handling of current economic challenges also ranked highly (63 percent), as did government bureaucracy and legislation (59 percent). Not surprisingly, government’s attitude to business was ranked the least favorable aspect of carrying out business in the U.S. Moreover, of those who saw government bureaucracy and legislation as one of the most unfavorable facets of the country’s business environment, 59 percent found tax law as the most burdensome area and businesses with lower revenue are more likely to think this is the case.
What’s more, when polled about government support, 69 percent of surveyed businesses responded that the U.S. government is not providing them with sufficient support. Survey findings also revealed that businesses with fewer employees are more likely to feel this way. When asked about initiatives the government should be carrying out to help them, 55 percent cited national debt reduction as the top priority, followed by reduction of business bureaucracy and legislation (47 percent) and reduction of business taxes (37 percent). Interestingly, attitudes to what the government should do are broadly similar across different types of business.
The message small businesses are sending is powerful and clear.
Although they have the will and potential to thrive – which they do, since they represent 99.7 percent of all employer firms in the United States - in a market they continue to hold in high esteem, the thick bureaucratic walls and lack of support and direction from the government is draining their confidence in a bright future. The findings of this survey, and what they mean, may present a great opportunity for small businesses to be heard and for the government to pay attention, so both we can work together and help each other move toward economic recovery.
Connie Certusi is the Executive Vice President and General Manager of Sage Small Business Accounting Solutions.