SMBs Enter 2019’s Final Quarter With Plate Full Of Concerns

The year’s final quarter is upon us, marking an opportunity to look back at Q3 and obtain a reading of small businesses’ most pressing — and most timely — concerns.

This week’s B2B Data Digest dives into the latest surveys of U.S. small businesses and finds, unsurprisingly, a trove of challenges on business owners’ plates.

Cyberattacks continue to rise, for example, with experts warning that small businesses are especially at-risk. There is also the knock-on impact from the ongoing trade dispute between the U.S. and China, which, small businesses say, is causing a ripple effect that may lead to price hikes. Hiring continues to be a challenge as business owners not only struggle to find qualified workers in a tight labor market, but find professionals who will help that company achieve its goals. The latest data also hints at the possibility banks may be feeling skittish about lending to small and medium-sized business (SMB) customers.

Although hiring slowed in September, small businesses continue to remain optimistic and have even reported some significant benefits resulting from late-2017’s tax reform.

PYMNTS breaks down the key data points from these reports below.

76 percent of U.S. companies have experienced a cyberattack in the last year, new Ponemon Institute research revealed in a survey of 592 firms. Smaller companies are most vulnerable, researchers said, pointing to their lack of resources and IT staff to bolster cyber defenses. More than 40 percent of companies overall said protecting consumer credit and debit card information is their biggest cybersecurity concern, eclipsed only by concerns of protecting customer records and intellectual property.

54 percent of SMBs say the Tax Cuts and Jobs Act positively impacted their businesses, new research from the National Federation of Independent Businesses said. Analysis of survey responses from more than 2,600 small business members of the NFIB revealed tax reform passed in late-2017 has had an overall positive effect on SMBs, and noted that small business optimism has enjoyed a two-year streak. More than one-quarter of companies surveyed said tax reform allowed them to retain more money, increase employee compensation or invest in their businesses. However, as separate reports in the The Wall Street Journal noted, the NFIB’s survey also revealed that small business hiring slowed in September as “finding qualified workers” remained a top concern for these companies.

52 percent of small businesses say “improving productivity and efficiency” is their greatest HR-related challenge ahead, new data from Oasis, a Paychex company, reveals. The firm surveyed more than 300 U.S. small businesses to explore business owners’ most pressing concerns for the next six to 12 months ahead, and found that many firms are troubled not only by hiring talent in a low-unemployment market, but by securing talent that can support their overall goals. A total of 41 percent of SMBs said their biggest concern is attracting quality employees to join their firms, while one-third each said their biggest concern is keeping employees focused on what’s most important to the business and developing talent to contribute to their business at a higher level.

37 percent of SMBs said the U.S.-China trade war has increased the cost of doing business, according to the latest information from BizBuySell, which surveyed more than 1,700 small business owners, according to CNBC reports. Nearly two-thirds reported that they may raise prices or consider switching to non-Chinese suppliers in response to those heightened costs. Nearly half (46 percent) said they’re losing customers because of increased trade tariffs.

28 percent of small businesses reported success in accessing a bank loan, according to Pepperdine University’s Graziadio School of Business and Management in a new report released in conjunction with Dun & Bradstreet. Their survey of 752 U.S. small businesses found this figure to have dropped quarter-over-quarter from 31.6 percent, raising concerns that SMBs are struggling to access capital. The majority of survey respondents (59 percent) agreed that they found it difficult to access debt financing, an increase from second-quarter figures. Further, 75 percent of mid-sized firms said they could obtain a bank loan, down from nearly 90 percent. Analysts said the data may reflect banks’ growing cautions in financing SMBs as concerns over a weakening economy grow.