Small Business News
Majority of Small Businesses Expect Increased Revenue This Year
In the face of continued uncertainty, a majority of small business owners are still bullish overall.
About the survey:
This week, Bank of America released its 2024 Business Owner Report. The survey included participation from more than 1,400 small and mid-sized business owners. In this case, a small business is defined as having between $100,000 to $5 million in annual revenue while “mid-sized” is capped at $50 million in revenue under BofA’s metrics.
Nearly two-thirds (65%) of small business respondents expect their revenue to increase in the year ahead. The figure increased to 87% among mid-sized businesses. What’s more, 55% of small businesses and 84% of mid-sized businesses already saw higher revenues in 2023 than they did in 2022.
As a result of these northward-trending revenues, 39% of small biz owners report plans to expand in the next year and 30% intend on hiring more employees in that time frame. Again, these figures were even higher in the case of mid-sized businesses, rising to 80% and 69% respectively.
Of course, in order to expand, many businesses will need additional funding. On that note, 71% of small business owners say they are likely to obtain funding for their business soon. This response is actually down nine points from last spring. In terms of what funding options these business owners are seeking, the top choice was business credit cards with 61%. That outpaced traditional bank loans, which were only mentioned by one-quarter of small business respondents. Moreover, only 16% of small business owners surveyed said they intend to apply for a bank loan or line of credit this year — which is a 33% decline year over year.
Turning to the economy at large, 42% of small business owners agreed with the statement “My local economy will improve.” That percentage was a slight increase from the previous BofA survey. However, when asked about the national economy, only 33% agreed that it would improve, which was down one point from last time.
What they’re saying:
Commenting on (and summarizing) these survey results, Bank of America’s President and Co-Head of Business Banking Raul Anaya said, “Our report finds that most mid-sized business owners are planning to expand their businesses and hire in the coming year. Most of these business owners are confident in their revenue growth as well as in the local, national, and global economies.”
My thoughts:
It’s interesting that many small business owners seem to feel more positively about their own financial prospects than they do about the larger economy. To some degree, that’s to be expected as entrepreneurs have much more control over their business than they do over anything else. Nevertheless, perhaps years of mixed economic signals have led some business owners to stop guessing where we’re headed next.
Setting aside the larger econ questions for now, it’s great to hear that small and mid-sized businesses are continuing to see positive outlooks — which is a trend that will hopefully carry on.
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