Despite Challenges, Local Entrepreneurs Are
Significantly More Likely to Grow Their Businesses Than They Were
One Year Ago
Seven years after the Great Recession, nearly two-thirds of Bay
Area small business owners (63 percent) report their businesses are
still recovering, according to the spring 2015 Bank of America
Small Business Owner Report, a semi-annual study exploring the
concerns, aspirations and perspectives of small business owners in
the Bay Area and around the country. Though many feel they have not
completely recovered, they are more optimistic about the economy,
business growth, revenue expectations and hiring plans than they
were a year ago, when comparing to findings in the spring 2014
report.
“The spirit of San Francisco shines through as small business
owners maintain their optimism and confidence,” said Emily Shanks,
small business banking Northwest regional executive for Bank of
America. “Throughout the recovery, Bay Area entrepreneurs have
maintained an impressive commitment to their employees and
customers, and Bank of America is proud to support their continued
success.”
Small business owners in the San Francisco area are far more
confident in the economy than they were a year ago. Fifty-nine
percent believe the local economy will improve over the next 12
months, compared to 49 percent in spring 2014. Bay Area respondents
are also more confident about growth in the national economy (55
percent versus 48 percent), and the global economy (40 percent
versus 35 percent).
San Francisco entrepreneurs are also feeling positive about the
future of their businesses. Sixty-two percent plan to grow their
business over the next five years, up 12 percent from last spring.
In addition, more than half (54 percent) expect an increase in
revenue over the next 12 months, compared to 49 percent last
year.
When looking at staffing, 40 percent of San Francisco small
business owners plan to hire more employees over the next year,
which is consistent with last year’s findings (38 percent). Despite
these hiring projections, nearly half of Bay Area small business
owners (46 percent) say it’s difficult to find qualified
candidates. Bay Area entrepreneurs say the top challenges in
finding qualified staff are attributed to a skills gap (60 percent)
and high salary demands (42 percent).
San Francisco small business owners demonstrate
self-sacrifice; prioritize employees and customersBay Area
small business owners are prioritizing the needs of customers and
employees before their own. The survey reveals that 68 percent of
local entrepreneurs would rather delay or reduce their own
compensation than take other courses of action to make ends meet;
this includes delaying or reducing compensation for their staff (7
percent) or scaling back on the services they offer customers (9
percent). Almost half (49 percent) report that they have never
given themselves a raise, or haven’t done so in more than two
years.
Almost all (96 percent) San Francisco small business owners say
they have employee appreciation programs, including:
- Dinners and outings (46 percent).
- Spot bonuses (40 percent).
- Office recognition (40 percent).
They also provide a number of benefits for employees,
including:
- Flexible hours (62 percent).
- Salary bonuses (45 percent).
- Office closure on major holidays (43
percent).
The majority (54 percent) of Bay Area small business owners cite
that establishing relationships with customers and clients is the
primary driver of repeat business, and they find many ways to show
their appreciation, including:
- Free products or services for their
first visit (34 percent).
- Monetary rewards, such as discounts or
free upgrades (33 percent).
- Personalized gifts (31 percent).
Additionally, 64 percent say a primary way they have adapted to
customer demands is by becoming more technologically savvy (62
percent nationally), while 52 percent have expanded product and
service offerings that cater to a younger client base (41 percent
nationally).
Bay Area small business owners feel appreciated by their
local community, but less so by policymakersBay Area small
business owners overwhelmingly support other small businesses in
the community by shopping small. Sixty-five percent of Bay Area
small business owners gave themselves an “A” or “B” grade for
shopping at other local small businesses. They also rate their
local community high in shopping small, as 57 percent handed out an
“A” or “B” grade when assessing how well local residents frequent
small businesses.
While many small business owners feel supported by their local
community, only 31 percent of Bay Area entrepreneurs believe that
policymakers appreciate small business owners.
Larger economic concerns remainAlthough overall economic
confidence is running high, San Francisco entrepreneurs still have
concerns over specific issues. Among the categories surveyed,
health care costs (61 percent) and the effectiveness of U.S.
government leaders (61 percent) are the top concerns among Bay Area
small business owners.
When asked about the impact of specific government policies, Bay
Area small business owners say the greatest potential for a
positive impact on their business could come from expanded tax
breaks for automatically enrolling employees into retirement
savings accounts (35 percent) and incentives to keep jobs on U.S.
soil (32 percent). Conversely, the policies that would have the
most negative impact on their business would be required health
care plans for employees (37 percent) and an increased minimum wage
(28 percent).
For an in-depth look at the attributes of the nation’s small
business owners, read the full spring 2015 Bank of America Small
Business Owner Report, and for additional San Francisco-based
insights, download the Small Business Owner Report San Francisco
infographic here.
About the Bank of America Small Business Owner ReportBraun
Research conducted the Bank of America Small Business Owner Report
survey by phone, from March 4, 2015, through March 27, 2015, on
behalf of Bank of America. Braun contacted a
nationally-representative sample of 1,000 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 also 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 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 largest
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
48 million consumer and small business relationships with
approximately 4,800 retail financial centers and approximately
15,900 ATMs and award-winning online banking with 31 million active
users and approximately 17 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.
Visit the Bank of America newsroom for more Bank of America
news.
www.bankofamerica.com
Reporters May Contact:Colleen Haggerty, Bank of America,
1.213.621.7414colleen.haggerty@bankofamerica.com
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