Business plan Archives - TAB Corporate

New Survey Shows What Small Business Owners Expect from the 2014 Economy

Profit

The Alternative Board keeps close tabs on changes in the pulse of small business owners — we like to know what entrepreneurs are looking forward to, what they’re apprehensive about and how they feel about the state of the economy, because often when things improve (or get worse) small business owners are the first to feel it.

We recently conducted the biggest survey of entrepreneurs in TAB’s history, questioning small business owners across a multitude of industries and with a variety of annual revenue levels. It gave us a clear snapshot of where their companies are today, how 2013 compared to 2012 and what business owners expect to see in 2014.

To give you an idea of the experience levels surveyed, the majority of small business owners have considerable experience as entrepreneurs – a full 86% have owned their businesses for at least eight years. Around one third own family-run businesses.

The entrepreneurs’ assessments of what business will be like this year is encouraging, to say the least. Here’s what our survey found:

Profits: Past, Present and Future

Compared to 2012, 64% of TAB members and 56% of non-members saw increased profits in 2013. An impressive 76% are expecting profits to increase in 2014, and 81% are looking forward to an increase in sales revenue. Only 1% of small business owners reported that they were expecting sales revenue and profits to sharply decrease next year.

Even better, the majority of entrepreneurs expect that it will be easier to access credit this year in order to grow their businesses. This is one area where strategic planning and advisory boards seem to have a big impact: 62% of TAB members believe it will be easier to access credit in 2014, while only 53% of non-TAB members feel the same way.

According to the entrepreneurs we surveyed, it looks like 2014 is shaping up to be a great year for business.

2014 Small Business Growth and Hiring Expectations

In 2013, 44% of TAB members and 25% of non-members added new staff. When asked if they planned to hire more full-time employees in 2014, the estimations got even rosier: exactly half said that they were indeed expecting to hire more people this year. Most of the remaining anticipated that their staffs will stay the same size—44% said they expect no change at all.

Threat Forecast: Cloudy With a Chance of Government Interference

The better your predictions, the better your decisions. How did business owners forecast their next year’s expenditure report? Of the foreseeable increase in costs, 43% reported the greatest increase would be in employee salaries, and 28% reported employee benefits.

When we asked what they identified to be the greatest threats to their businesses, entrepreneurs cited increasing healthcare insurance laws, sluggish demand and shaky consumer confidence. The biggest overall threat that business owners identified, however, was “government”, which 57% of all entrepreneurs surveyed listed as their number one concern.

As you would probably expect, Americans tend to fear government policies more than their Canadian or UK-based counterparts. Here’s how the numbers broke down:

  • 65% of U.S.-based entrepreneurs said Government was the biggest threat to small businesses like theirs within their region.
  • 61% of Canadian entrepreneurs said Government was the biggest threat to small businesses like theirs within their region.
  • 31% of U.K.-based entrepreneurs said Government was the biggest threat to small businesses like theirs within their region.

We also noticed a significant trend: the more annual revenue a business brings in, the more the owner of the company is likely to list healthcare as a top concern – and that concern is growing, at least for American business owners. Last year, 21% of U.S.-based entrepreneurs said that healthcare was the biggest threat to businesses within their region, and this year that number jumped up to 36%. Healthcare costs just don’t have as much of an impact on businesses in Canada and the U.K.

The Small Business “Bill of Health” for 2014

On the whole, entrepreneurs gave a very positive 2014 economic forecast. Most are preparing their operations and staff for increased sales, and many of the small business owners we surveyed believe that their profits will respond in kind.

The survey also revealed that members of The Alternative Board were more likely than non-members to anticipate increased profits in 2014. This is not a coincidence. The Alternative Board works to turn the self-employed into business owners, and there are several crucial differences between the two. Which one are you? Find out where you stand (and where you’d like to be) with this chart.

Our extensive experience has shown that peer advisory boards and small business coaches are the most valuable feedback tools for business expansion —and the majority of entrepreneurs we surveyed concurred. Contact us today to discover the resources that are available to make 2014 your highest growth year yet!

Small business trends report

 

91% of Business Owners Could See Higher Revenue Using a Strategic Plan

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The Alternative Board (TAB), the world’s largest franchise provider of peer advisory boards and business coaching services, released the results of its quarterly, third-party Small Business Pulse Survey today – and the results are surprising. Although 76% of respondents say they believe having a written strategic plan increases overall business performance, 91% don’t have what they consider to be an “excellent” plan. In fact, 22% have no written strategic plan at all. While the majority of business owners are expecting the economy to improve, they admit they’re not in the best position to capitalize on it.

“There are many business owners who do not have a good strategic plan. They’re missing opportunities – and they know it.” says David Scarola, Vice President of The Alternative Board. “The time investment required to write and regularly review strategic plans pays off big in the form of increased sales revenues, higher profits and more opportunities.”

When asked what they feel the most significant benefit of strategic planning is, 66% of business owners say it helps them identify and seize new opportunities (as illustrated by this infographic). Moreover, respondents agree that continually reevaluated business plans are most likely to improve revenue growth, profit and marketing effectiveness. Despite the fact that business owners know the benefits of having written strategic plans, only 40% rate their own plans as “good” or better. The primary reason CEOs aren’t writing or reviewing their business plans? Lack of time.

“The complaint that your company ‘does not have time’ is proof that you need to invest time for this,” says Allen E. Fishman, TAB’s founder and best-selling author of The Alignment Factor. “The reality is that strategic business plans have been proven to save an enormous amount of time in every industry. And time, as we all know, is money.”

To get a clearer picture of who was surveyed: 65% are family-owned business owners. About half of those surveyed are members of TAB – this segment of the study group overwhelmingly review and adjust their strategic plan quarterly. By comparison, the non-TAB members felt an annual adjustment was sufficient. Those looking for a measurable result of the benefits provided by TAB’s strategic planning template might point to the fact that 56% of the entrepreneurs who belong to TAB plan to add to their full-time sales staff this year, compared to just 34% of non-TAB members.

“The most recent survey results validate our long-held belief, based on over two decades of working with thousands of small- and medium-sized business owners, that having a strategic plan to guide their business is critical to achieving success,” says Scarola. “It’s in the business owners’ best interest to have a good plan that is reviewed regularly.” However, only 16% of business owners currently review and update their plan on a monthly basis.

The TAB survey also asked questions regarding how small business owners feel about the economy, which led to some interesting answers. While the economy may be stronger overall than it was a year ago, this sentiment varies widely by country. An impressive 73% of U.S. small business owners indicate that the economy is better than it was last year, while only 48% of British and 45% of Canadian CEOs feel the same way. Optimism is high among all survey respondents, though, with 66% anticipating an improvement in their local economy over the coming year. Even more telling, 77% polled expect higher sales revenue and 75% predict an increase in profits.