Many US small businesses are optimistic about growth and see the economy improving in three to six months, according to a survey released yesterday.
Four out of five small businesses are pursuing a moderate or aggressive growth strategy, expanding into new markets and producing more revenue among existing customers, according to the survey by Chase Card Services, the credit card division of JPMorgan Chase & Co.
Only five per cent said they were not looking to grow business aggressively, according to the survey, which questioned 168 chief and senior executives from the annual Inc. 500/5,000 list of fastest-growing small companies between September 10 and 14.
Three-quarters of the companies said they believe the US economy and their business will be doing better in three to six months. Some 27 million small businesses operate in the United States and are responsible for roughly 40 million jobs.
The optimistic results validate a sense that the economy is improving, said Richard Quigley, president of Ink from Chase, a new portfolio of cards designed for small businesses.
"There's certainly a bit of light on the horizon," he said. "We're not home yet but it's certainly going in the right direction." As to hiring, 49 per cent of the small businesses said they were adding positions, and 29 per cent said they were not adding jobs but were hiring to upgrade talent, it said.
Fifteen per cent of the companies said they had a hiring freeze, and five per cent said they were cutting staff, it said.
However, asked to name the hardest part of owning a business right now, the most common answer was being able to forecast accurately.
Mr Quigley said he attributed that response to small business owners being "driven by gut level passion that is not always tied to logic".
"Logically, I think a lot of people wouldn't even start a small business," he said. Inc., which publishes Inc. magazine and provides resources to entrepreneurs, annually ranks privately held, US-based, for-profit independent small businesses according to percentage revenue growth for four calendar years of sales. To qualify, company revenue in 2005 must have been at least $200,000 and in 2008 must have been at least $2 million. The top 10 per cent of companies on the list comprise the Inc. 500.
The online survey by Chase contacted one-third of the 5,000 companies and received about a 10 per cent response rate, a spokeswoman said. No margin of error was calculated, she said.