Small & Mid-Market Business Bullish on Economic and Company Growth
According to the annual Business Pulse Survey by SunTrust Banks, Inc., nearly two-thirds of business leaders expect the global and US economy to improve through 2017. Even more optimistic about their own companies, as 75% of middle market (annual revenue of $10-150 million) and small business (annual revenue of $2-10 million) leaders feel their business outlook is strong. Both segments have high expectations for healthcare (46%) and tax reform (44%) as a catalyst for growth. Mid-market leaders also cite reducing regulations (39%) and investments in infrastructure (37%) as ways to spur business momentum.
“This year, business leaders are feeling very prepared to take advantage of growth opportunities, 75% believe they have access to the critical capital needed,” said Allison Dukes, Commercial and Business Banking executive at SunTrust. “Three out of four have a goal-setting process linked to long-term growth strategies and are comfortable that they will achieve their goals.”
In 2017, the short term priority for 31% of mid-market companies is profitability, a 29% increase since 2016; while 34% of small businesses are focused on revenue, a 54% increase from last year.
Looking out five years, introducing a new product or service is still the top long-term strategy to stimulate growth for both mid-market (40%) and small business leaders (31%), while making a major capital investment (31%) and acquiring another company (17%) is a greater priority for the mid-market. To undertake these initiatives, common strategies include using cash on hand, reducing costs, obtaining a bank loan and reinvesting corporate earnings.
“Over the past four years, businesses in the small and mid-markets have taken incremental steps toward growing their companies, including M&A, hiring, and improving cash flow. At SunTrust, our purpose is to Light the Way to Financial Well-Being for our clients, and we have been working with them to ensure they have the tools and capabilities to grow their business in a smart way. Now, they see an opportunity for significant structural changes in taxes and regulations to unleash additional business growth,” added Dukes.
Decision-makers representing more than 500 small and mid-size businesses participated in the SunTrust/Radius Global Market Research survey. Survey results have a maximum margin of error of +/- 5 percentage points at a 90% confidence level.
(Source: SunTrust Banks, Inc.)