Two-Thirds of U.S. SMBs Feel Optimistic About the Future

New research commissioned by Acquis revealed that 65% of small to medium businesses (SMBs) in the U.S. are feeling optimistic about the future. The research included insights from more 500 senior managers of SMBs (10 to 249 employees) from a range of industries across the U.S. about the challenges they are facing in their own businesses as well as across their wider industries.

The study found that SMBs in the IT (75%), financial (74%) and retail (74%) sectors felt the most optimistic about the long-term future of their businesses, with 65% of SMBs across the board feeling positive about the future.

While optimism was high for some, one in five of those surveyed said they were feeling pessimistic about their long-term future as a business. Those in the manufacturing, business administration, healthcare and beauty sectors were most pessimistic about the future, with as many as 33% of respondents claiming they had some degree of pessimism about their future as a business.

When asked where they saw growth opportunities over the next 12 months, 48% of SMBs identified that these would come from cost and pricing optimization. Investment in employee wellbeing was seen as the second biggest opportunity for growth (40%). Other opportunities identified in the research included being able to deliver new products and services through increased digitalization and automation.

In terms of the challenges faced by SMBs, supply chain issues were identified as the biggest concern over the coming 12 months, with 51% of those who took part saying that this was expected to have the biggest negative impact on their business overall.  Sourcing and retaining the workforce is also a big concern for 47% of SMBs, with 47% also naming fraud and regulatory challenges.

The survey demonstrated that SMBs were ambitious about investing for their future growth with 88% claiming they plan to invest in new business equipment/assets over the next five years, despite 51% of businesses seeing supply chain issues as a major challenge over the next 12 months.

When asked how they would fund this investment, 26% said that they would be using leasing or equipment finance agreements to make these investments. In terms of where this investment would go, equipment (33%) and software (28%) are the most likely types of assets to be purchased.

“It’s great to see a level of optimism among SMBs in the US, but it is somewhat surprising was the widespread concern around supply chain issues across all sectors as this would imply that businesses are still feeling the impact of several major macro-economic events including the pandemic, the ongoing wars across the globe and global resource shortages,” Brian Madison, managing director of Acquis North America, said. “In an inflationary environment, it’s not surprising to see cost and pricing dominate SMBs thinking on growth strategy. SMBs will keep price relative to cost, however, achieving the right balance will be a big challenge for businesses in the coming months.

“It’s encouraging to see that a large majority are planning to invest in essential business equipment in the near future and that leasing is seen by a quarter of SMBs as a good choice to fund that investment,” Madison said. “However, with credit cards still a top choice for 42% to finance equipment, this gap presents a big opportunity for asset finance companies to increase leasing’s share of the commercial finance market.”

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