One-third (33 percent) of small business executives believe their current financial situation has improved since this time last year. Since Q3 2013, the percentage of businesses reporting a stronger financial situation over the last 12 months has declined by four points, while the percentage reporting worsening conditions has increased from 16 percent to 22 percent. Forty-three percent of small business executives believe their current financial situation is about the same as it was last year.
National sentiment about current business conditions among many small business executives is negative, as more than half (54 percent) consider conditions only fair or poor, representing a two-point increase compared to the previous quarter.
The national economic outlook among small business executives has worsened since Q3 2013. While 52 percent of business owners were optimistic about the 12-month outlook for the national economy last quarter, only 46 percent of business owners this quarter anticipate favorable conditions. Small business executives in the western United States (54 percent) and those with a largely international customer base (58 percent) report higher-than-average optimism about the economy.The 12-month economic outlook for local economies is predominantly positive with 56 percent of business owners reporting optimism compared to 39 percent reporting pessimism. This represents a one-point decline in confidence since the previous quarter – only a slight drop compared to the 7 percent decline between Q2 2013 and Q3 2013. As with the national economic outlook, the survey results indicate that small business executives with primarily international customers (71 percent) are more likely to anticipate favorable conditions in the year ahead. Following are additional key trends derived from this quarter’s survey.
- Most small businesses use mobile technology: Eighty-six percent of small business owners use mobile technology to interact with customers. Small business owners believe mobile technology will have the most positive impact on interacting with customers (56 percent) and sharing office documents (16 percent). Thirty-four percent of small business owners use mobile business technology (on phones and tablets) every day.
- Online marketing is the top priority for small business owners going into 2014: Eighteen percent of small business owners say that marketing their business online is their number one priority going into the new year. Other priorities include improving work-life balance (14 percent) and incorporating new technologies into business management (11 percent).
- Nearly half of small business owners have yet to update their 2014 business plan: Small business owners were evenly split on this issue; 46 percent of small business executives had updated their 2014 business plan before the end of Q4 2013, while 46 percent had not.
- A majority (54 percent) of small business owners do not plan to have their 2014 business plan reviewed by a financial professional: Thirty-one percent report that their business has the necessary in-house capabilities, while 23 percent report that their business does not need it.
- The federal government shutdown had a negative impact on small businesses: About one-third (34 percent) of small businesses nationwide were impacted by the government shutdown in October, with nearly all reporting that their finances were negatively affected.