Rising inflation has been the greatest challenge for small business owners over the past year. However, they feel motivated to grow their businesses. According to Capital One Small Business and its partners, nine in ten small business owners believe their business will continue to operate in the next six month.
According to the study, SMBs felt the most adverse effects of affordability issues in higher prices and lower sales volumes. This is because cost-conscious consumers are reevaluating their spending habits. SMB owners reported that they are prepared despite the inflationary pressures, 48% of respondents said. However, they also feel more prepared having taken proactive steps to mitigate the negative effects of inflation on their businesses.
Must Read: https://www.guidetechnology.us/despite-rising-inflation-smbs/
Burnout and savings:
SMB owners most often reported that they used their savings to expand (77%) and start (50%) their businesses. Three quarters of millennial SMB owners said they used their own savings to launch their business, while just over half (52%) reported that they used their savings to expand their business, in the same way as all small business owners.
SMB owners also reported that student loan debt had negatively affected their ability to grow and scale their businesses. Around one-third (30%) of SMB owners and 31% (31) of millennial SMB owners said that student loan debt has hampered their ability to scale their businesses.
Entrepreneurs have had to deal with the stress of running a small business over the past year. Nearly half (42%) of SMB owners reported experiencing burnout within the last month. 24% of those surveyed said that they are currently experiencing burnout as a result of “chronic stress at the workplace” (characterized by exhaustion, negativity, a lack or commitment to clients, and dissatisfaction about job performance.
Most Popular: https://www.smartphonetutor.com/analytics-software-and-tools
SMBs should be concerned about rising inflation
The study revealed that SMBs are optimistic despite facing difficulties in the past year, such as a perceived decline in business conditions, rising inflation and interest rate rises, and tight labor markets.
Despite this optimism, almost half of SMB owners believe that local business conditions are good or excellent (43%) — a decrease from 57% in December 2021. However, 94% say they are good or excellent.
Never Miss: https://www.dailytechnologystudy.com/cloudwatch-and-pingdom-monitoring/
Over three quarters of SMB owners (77%) worry that inflation could negatively impact their business’ performance over the next three months. 71% of SMB owners felt that inflation had had a negative effect on their business over the past three months. This was most often due to higher costs of goods and services (59%), and lower sales (23%).
It is difficult to find talent
SMB owners reported that it was difficult to find qualified candidates for new hires and that they were not paid competitive wages. According to the study, 20% of respondents said it was difficult to hire employees within the past three months. However, 75% of those who responded to the survey stated that they haven’t hired any new employees during this time.
It has been slightly more difficult to hire millennial SMB owners (26%), and dealership owners (73%). 33% of SMB owners who had difficulty hiring new employees cited wage issues and the perceived shortage of qualified candidates in their area (32%).
16% of SMB owners have changed their hiring policies to offer more competitive wages in order to attract and retain talent. According to the study, Millennial SMB owners (47%) are more likely than small business owners (36%), to raise their employees’ salaries.
SMB owners of all ages expressed confidence (76%) in their ability to fill open jobs within the next three months. This is more common for those who have 51 or more employees (88%) than for those who have 50 or fewer employees (75%).
Also Read: https://www.dotechnology.co.uk/sisense-vs-tableau/
Capital One Small Business conducted a survey among 1,200 owners of small businesses and 300 owners of auto dealerships between March 25 to March 30, 2022 in partnership with Morning Consult, the NextGen Chamber of Commerce and Morning Consult. The definition of small businesses was those that have less than $20,000,000 in annual revenue.
