The Hartford’s Small Business Success Study surveyed 2,000 small business owners nationwide to gain a better understanding of the issues and factors impacting their success. Many of the small business owners they count as customers were surveyed to assess how well-equipped they are to maximize the future success of their business while navigating current challenges. Regardless of who your commercial business insurance is with, check out some of the interesting highlights from The Hartford’s study.
Different Ways to Define Success: Passion Before Profit
Small business owners remain optimistic about their success — even in a tough economy — because profits aren’t always the definition of success. In fact, 82 percent say they place great importance on doing something they feel passionate about and enjoy. Although 77 percent acknowledge that increasing profitability of the business year over year is very important, only 18 percent say this is the most important factor in defining success.
The study’s findings also shed light on the widely-held belief that all small business owners seek to expand and maximize profitability. In fact, it found that growth is not a shared goal among all small business owners. While 52 percent do consider themselves to be growth-oriented, 48 percent describe themselves as maintenance-oriented and are comfortable running their business at its current size.
Additional Barriers to Success
It is clear that the national economy continues to put pressure on a majority of small business owners, with 57 percent indicating it has had an impact. When asked what keeps their business from being successful, small business owners note that financing their business is a particular area of pain. Specifically, 34 percent of respondents say that obtaining a loan or other capital is difficult.
Small businesses are also challenged by government regulations, which result in greater administrative and accounting burdens. According to the study, small business owners identify economic constraints, such as government rules, regulations and taxes, as the single biggest factor holding them back (37 percent). And, they say that uncertainty about how public policy could potentially stunt the future growth of business is hindering their ability to plan ahead.
Few Focus on Long-Term Planning
It’s not uncommon for many small business owners to overlook long-term planning goals while focusing on short-term business needs. The study’s findings validated this common oversight, with only 35 percent of small business owners saying they have a formal, written business plan for the future.
Maintaining a Positive Outlook
In spite of the current economic environment, many small business owners remain optimistic about their prospects for success in the short-term, with 51 percent projecting that they will be very successful in the next two years. Only 6 percent are predicting they will fail to achieve success in that timeframe. Confidence in their ability to stay in business is a major factor leading many small business owners to feel as though they are currently successful.
For more information on The Hartford Small Business Success Study
Contact your Tower Insurance commercial agent to discuss your success strategy for 2012.