Financing Not Really an Issue for Small Business According to the NFIB
Small businesses need money right? Well according to an August 2015 survey conducted by the National Federal of Independent Business, 21% of respondents said that taxes were the single most important problem facing their business today. That ranked highest on a list of ten issues. Only a minuscule 1% said that financing and interest rates were the most important problem. Even inflation was ranked as more important than financing.
Thirty-three percent of all owners reported borrowing on a regular basis and similarly, thirty-three percent reported all credit needs met. 49 percent however, explicitly said they did not want a loan. This data is based on a sample of 3,938 small-business owners/members that translated into 656 usable responses received for a response rate of 17%.
20% of respondents said that government requirements and red tape were the single most important problem they face, second to taxes.
One could infer from the data that access to capital is not a challenge for small business right now, which would make sense given how many non-bank alternatives are currently available. It also raises the question as to why regulations for non-bank alternatives would be considered a priority when small businesses seem to be pretty content with the way things are. If anything, the message here is that the best solution to grow small business is to lower their taxes. With that remedy being unlikely, a potential takeaway from this study then is that non-bank financing companies should consider ways to address their prospects’ two biggest pain points, taxes and government requirements. And if not those two, then the third issue that respondents said was the single most important problem, poor sales.
How can non-bank financing companies help small businesses address poor sales? This may be the key to long-term mutual success.Last modified: September 11, 2015
Sean Murray is the President and Chief Editor of deBanked and the founder of the Broker Fair Conference. Connect with me on LinkedIn or follow me on twitter. You can view all future deBanked events here.