Access to Funding Up but Demand is Down for the Small Business Sector
The study segmented results for those businesses with less than
Both small and mid-sized business owners are optimistic about their own business' health and growth for the next year. More than three quarters (80%) of small and mid-sized businesses expect 2016 to be better than the previous year, with 87% of businesses confident that their enterprise will grow in 2016. Nearly three quarters (72%) of small and mid-sized businesses expect to increase revenue in 2016 by an average of 10%.
"Across the entire year of 2015, we've seen significant economic progress for small businesses. Access to capital has increased, hiring is up and confidence is high," said
Although the small business sector is optimistic about their own success, small businesses continue to have lingering concerns about the state of the overall economy. More than half (56%) of small businesses believe the current economic environment is restricting their businesses' growth opportunities compared to just a quarter (25%) of mid-sized businesses. Forty-nine percent (49%) of small businesses indicated the current business financial environment is also restricting their ability to hire, compared to 22% of mid-sized businesses.
The small businesses in the survey have maintained an upward trend in accessing capital over the year, with a 5% increase in successful bank loan financing (35% financing success rate for Q4), in addition to an increase in access from alternative business financing options including: business credit cards (60% success rate), merchant cash advance (31% success rate), and business online marketplace lenders (26% success rate).
Mid-sized businesses, however, are seeing decreases in both demand for capital (-3.8% change since Q3) and bank loan access (73% success rate, a 17% decrease since Q3).
"Mid-sized businesses struggled with demand more than their small counterparts for the first time in quite a while, which is concerning," said Dr.
Domestic economic uncertainty is a key reason that small (20%) and mid-sized (28%) businesses attribute for their inability to hire. Hiring is likely to increase, however, as 57% of all small businesses and 56% of mid-sized businesses said they plan to add between 1-10 employees in the next six months. Forty percent (40%) of mid-sized businesses believe that hiring qualified employees in 2016 will be the most significant challenge for their business in the upcoming year.
Florida(69%) Georgia(68%) Illinois(68%) Massachusetts(67%) New York(67%) California(65%) Texas(64%) Pennsylvania(63%)
The Q4 2015 Index report was derived from 2,773 completed responses collected from
A leader in cultivating entrepreneurship and digital innovation, the
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