The CAN Capital Index is out!
Sixty-One percent of small business owners expect business growth within the next 12 months according to CAN Capital, Inc., the market share leader in alternative small business finance. This finding is part of the CAN Capital inaugural Small Business Health Index, powered by SurveyMonkey™.
The CAN Capital Index taps into key issues and trends that can help business owners across the country to expand and grow their businesses. The data also revealed some of the challenges facing small businesses, including leveraging the right advertising and marketing strategies, attracting and retaining talent, battling big-box retailers and accessing capital.
CAN Capital Index
“We’re seeing some inconsistency in small business owner reaction from other third-party research around industry optimism in the news, but our Index and customer data show a positive trend when it comes to growth, suggesting small businesses are feeling confident in accessing working capital to expand, purchase equipment and make other improvements,” said Daniel DeMeo, Chief Executive Officer, CAN Capital.
Priming the Pump for Growth
CAN Capital survey data shows that small businesses are preparing for growth with almost a third (31 percent) looking to expand and/or try new forms of advertising/marketing activities (such as online ads, email marketing, etc.). Over one quarter (26 percent) of small business owners plan to purchase equipment and/or make inventory investments over the next year.
CAN Capital customer data corroborates this trend, as in the first half of the year it has provided access to working capital to about 10,000 unique customers that sought out working capital to invest in their businesses. In 2014 to date, this has equaled almost half a billion in funding.
“The CAN Capital Small Business Health Index, powered by SurveyMonkey, was created to help small businesses make wiser decisions that can positively affect their profitability and growth, a mission that our two companies certainly share,” said David Goldberg, Chief Executive Officer, SurveyMonkey.
Changes and Challenges
In terms of changes and challenges affecting small businesses, the Affordable Care Act was named as one regulation that small business owners (33 percent) said had/will have an effect on their businesses, though it’s not clear if that effect has been positive or negative.
Thirty-seven percent of small business owners view the ability to offer competitive prices as their biggest challenge when competing with big businesses, with ability to offer competitive benefits for employees coming in second at 18 percent. In terms of potential threats, thirty-four percent of small business owners shared that the biggest threat to small businesses today is rising employment costs.
Capitalizing on Capital
Forty-five percent of small business owners surveyed anticipate needing external capital to run their small business in the next year. However, 65 percent of them say that gaining access to working capital is quite or extremely challenging. While 30 percent of small business owners say that the easiest way to obtain funding/working capital is applying for a bank loan, more of them (40 percent) have actually been more successful in securing funding/working capital from friends and/or family than from a bank (27 percent)
Other key consumer and marketing trends from the study affecting small businesses include:
· Mobile and/or online business reviews are the number one consumer trend that small business owners (44 percent) say will have an impact on their business. A valid point as according to research from LocalVox – a New York City-based company that focuses on leveraging online marketing to drive in-store sales for franchises, large-multi-location businesses and small businesses – restaurants with 3.5 stars on Yelp are 63 percent more likely to be full than those with just three stars. This means that a half-star difference translates to a 5-19 percent increase in revenue.
· Online shopping came in second as the other top consumer trend that small business owners (34 percent) say will have an impact on their business.
· Interestingly, a plurality of respondents (41 percent), have not optimized their business website for all mobile devices. LocalVox research shows that 88 percent of consumers who search for a type of local business on a mobile device call or go to that business within 24 hours, which underscores how critical it is for small businesses to ensure they’re appealing to customers via mobile.
Learn more about the CAN Capital Small Business Health Index, powered by SurveyMonkey by visiting www.cancapital.com.