Small-business owners’ optimism on business prospects and the economy continue to rise, according to the Fall 2014 American Express OPEN Small Business Monitor. Currently, 63 percent of business owners nationwide maintain a positive outlook, a level not reached since fall of 2007 (64 percent). Stronger revenue growth could be fueling this optimism, as more entrepreneurs say their revenues are higher when compared to a year ago (42 percent, up from 38 percent in 2013). “We are at a long-awaited point where business owners are seeing the growth that they have been waiting for. Business owner optimism reflects the fact that sales are up, and prospects are looking good for small companies. Small businesses are practical, so for their optimism to be so high indicates that they are seeing sales in hand, not just potential sales,” says Alice Bredin, American Express OPEN small business advisor.
Here in Arizona, one of the hardest-hit states in the Great Recession, optimism is lagging, with just 56 percent of small businesses reporting an optimistic outlook versus 63 percent nationwide. “The uncertain economy is their biggest challenge, and just 20 percent of Arizona small businesses have hiring plans versus 37 percent nationwide,” Bredin says, adding that while the lag is real, the recovery will come to Arizona businesses, too. “More than half of Arizona businesses are reporting capital investment plans and, interestingly, Arizona-based businesses are on par with business owners nationally in seeing the glass half full. Eighty-four percent of Arizona businesses agree with this sentiment; nationally, the number is 87 percent. This number really speaks to what is so amazing about small business owners — their resilience,” she says.
Bredin said she was pleased to see that, as usual, entrepreneurs report in huge numbers that the rewards of being an entrepreneur outweigh the demands. “Eighty-eight percent of businesses in Arizona agree with that statement,” she says. She was also pleased to see that businesses are inclined to purchase goods and services from other small businesses. “In this category, businesses in Arizona are outpacing small businesses nationwide: 81 percent of Arizona businesses do this versus 73 percent of small businesses nationwide,” she says.
The rosier outlook from business owners also reflects that cash flow concerns are easing and that over the next six months business growth is the single most important priority for business owners. The last time this occurred was in spring 2011.
“Business owners have waited for a turn-around, and I am pleased that many are feeling more hopeful,” Bredin says. “Forty-six percent of Arizona businesses report that their top priority is to grow their businesses, versus 35 percent nationwide. I am wishing them well in that endeavor.”
American Express OPEN Small Business Monitor, released each spring and fall, is based on a nationally representative sample of 1,130 small-business owners and managers of companies with fewer than 100 employees.
|Big Data for Small Business|
|Business owners are seeking ways to improve customer interaction, and more are analyzing data|
|Attitudes Toward Data||Percentage|
|Firms currently analyzing data for their businesses||69%|
|See value in analyzing data to better run their enterprise||85%|
|Aware of low-cost tools for data analytics||62%|
|Say time is biggest barrier to data analytics||48%|
|Use data to improve current products/services||72%|
|Analyze data to make key business decisions||66%|
|Analyze data to boost efficiency||65%|
|Use data to identify ideas for marketing||58%|
|Use data to identify opportunities for new products||52%|
|Analyze data to track loyalty/rewards usage||37%|
|Big Data for Small Business (con’t)|
|The OPEN survey includes a Success Index, which shows 11 percent of American small-business owners to be “High Achievers” (scoring at least 81 on a 100-point scale)|
|Behaviors/Attitudes of Successful High Achievers||Percentage|
|Say they are planning to grow their businesses over the next six months||92%|
|Have growth as their top priority||51%|
|Plan to hire||79%|
|Plan to make capital investments||67%|
|Would give employees raises or bonuses before themselves||85%|
|Use social media||78%|
|Say they can’t live without their smartphone||42%|
|Have a business mentor||66%|
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