Despite Lingering Economic Concerns,
Area Entrepreneurs Have Highest Business Expectations for 2016
out of Nine Markets Surveyed
Small business owners in the Greater Washington area are
overwhelmingly optimistic, according to the fall 2015 Bank of
America Small Business Owner Report, a semi-annual study exploring
the concerns, aspirations and perspectives of small business owners
in Washington, D.C. and around the country.
More small business owners in the Greater Washington area are
hiring than any other market surveyed: 73 percent plan to add
headcount in the coming year, an increase of more than 30
percentage points from two years ago and the highest since the
inception of the report in 2012. Additionally, 81 percent plan to
grow their business over the next five years, a 20 percentage point
spike from last year ‒ also higher than any other market
surveyed.
Not surprisingly, this expected growth demands capital. Nearly
one-third (32 percent) of Greater Washington small business owners
plan to apply for a loan in 2016, an increase of 14 percentage
points from last year. Of those who plan to apply for a loan, 46
percent plan to hire more employees and invest that capital in new
equipment.
“The increase in optimism among small business owners in Greater
Washington is incredibly encouraging,” said Ryan Coughlin,
Washington, D.C. small business banker manager at Bank of America.
“As more entrepreneurs plan to hire additional employees and grow
their businesses, we look forward to seeing the impact these
advancements will have on our community.”
Economic confidence is on the rise, despite lingering
concernsIn addition to optimism surrounding their businesses,
Greater Washington small business owners are more confident in
their local and national economies. Nearly two-thirds (65 percent)
believe the local economy will improve in the next year, an
increase of 23 percentage points from a year ago, and more than
half (55 percent) believe the national economy will improve (versus
41 percent a year ago). Though small business owners are less
confident in the global economy, this confidence has increased
considerably since last year. Forty percent believe it will improve
in the next year, versus 25 percent who said the same a year
ago.
When asked about their top concerns, Greater Washington small
business owners believe the following factors could potentially
impact their businesses over the next 12 months:
- The possibility of future interest rate
hikes (33 percent).
- The upcoming U.S. presidential election
(32 percent).
- The possibility of a rising minimum
wage (30 percent).
- Financial crises in countries abroad
[i.e., China and Greece] (25 percent).
Greater Washington small business owners embrace workplace
2.0The workplace culture in Greater Washington has shifted in
recent years resulting in collaborative, tech-friendly and flexible
environments. While 30 percent of small business owners believe
technology has reduced their staffing needs, nearly all (91
percent) say that changing technology has helped their business. In
addition, 86 percent of Greater Washington small business owners
say they are very willing to adopt new technologies; for example,
more Greater Washington entrepreneurs have created a mobile app for
customers than any other market surveyed (31 percent).
Small business owners are also embracing a different work
environment, as 47 percent say their workplace has become more
focused on teamwork and collaboration over the past five years.
This collaboration is taking place despite an increase in the
amount of flexibility that employers are now offering, as nearly
half (48 percent) currently offer their employees the option to
telecommute, compared to just 32 percent five years ago.
Small business owners are beginning to offer nontraditional
perks as well, including areas to relax and unwind, such as nap
pods or game rooms (26 percent), the ability to bring your pets to
work (13 percent), or onsite gym or workout classes (11
percent).
Technological advancements require additional
precautionsIn Greater Washington, 11 percent of small business
owners have already fallen victim to a cybersecurity breach. In
order to better protect themselves, more than three-fourths (76
percent) are upgrading their technology once a year or more, the
highest of the nine markets we survey. As a result, more than three
in five (62 percent) local small business owners feel prepared for
a cybersecurity breach.
Greater Washington entrepreneurs looking forward to a
successful year-endGreater Washington small business owners
expect to end the year on a high note: 86 percent say it’s likely
they will hit their year-end revenue goal, 9 percentage points more
than last year. Many Greater Washington small business owners
intend to offer year-end perks to their employees, such as salary
bonuses (56 percent), a holiday party (54 percent) or office
closures (49 percent).
When it comes to holiday milestones, the majority of Greater
Washington business owners continue to state that Black Friday and
Cyber Monday have no impact on their business’ bottom line, but
they are becoming stronger revenue drivers for some. Fifty percent
of Greater Washington small business owners say Black Friday has an
impact on their business’ bottom line – a 17 percentage point jump
from one year ago. Similarly, 42 percent of small business owners
reported that Cyber Monday has an impact on their business’ bottom
line, compared to 31 percent in fall 2014.
For an in-depth look at the attributes of the nation’s small
business owners, read the full fall 2015 Bank of America Small
Business Owner Report, and for additional insights from small
business owners in Greater Washington and across the country,
download the Small Business Owner Report local insights infographic
here.
About the Bank of America Small Business Owner ReportBraun
Research, Inc. conducted the Bank of America Small Business Owner
Report survey by phone from August 21 through September 22, 2015,
on behalf of Bank of America. Braun contacted a nationally
representative sample of 1,001 small business owners in the United
States with annual revenue between $100,000 and $4,999,999 and
employing between 2 and 99 employees. In addition, 300 small
business owners were surveyed in each of nine target markets: Los
Angeles, Dallas, Washington, D.C., New York, Boston, Chicago, San
Francisco, Atlanta and Miami. The margin of error for the national
sample is +/- 3.1 percent; the margin of error for the oversampled
markets is +/- 5.7 percent, reported at a 95 percent confidence
level.
The Braun Research survey results conducted on behalf and for
the exclusive use of Bank of America and interpretations in this
release are not intended, nor implied, to be a substitute for the
professional advice received from a qualified accountant, attorney
or financial advisor. Always seek the advice of an accountant,
attorney or financial advisor with any questions you may have
regarding the decisions you undertake as a result of reviewing the
information contained herein. Nothing in this report should be
construed as either advice or legal opinion.
Bank of AmericaBank of America is one of the world's leading
financial institutions, serving individual consumers, small and
middle-market businesses and large corporations with a full range
of banking, investing, asset management and other financial and
risk management products and services. The company provides
unmatched convenience in the United States, serving approximately
47 million consumer and small business relationships with
approximately 4,700 retail financial centers, approximately 16,100
ATMs, and award-winning online banking with 32 million active users
and more than 18 million mobile users. Bank of America is among the
world's leading wealth management companies and is a global leader
in corporate and investment banking and trading across a broad
range of asset classes, serving corporations, governments,
institutions and individuals around the world. Bank of America
offers industry-leading support to approximately 3 million small
business owners through a suite of innovative, easy-to-use online
products and services. The company serves clients through
operations in all 50 states, the District of Columbia, the U.S.
Virgin Islands, Puerto Rico and more than 35 countries. Bank of
America Corporation stock (NYSE: BAC) is listed on the New York
Stock Exchange.
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Reporters May Contact:Nicole Nastacie, Bank of America,
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