South Florida small businesses, you are an optimistic bunch about your own businesses. In fact, your outlooks are much sunnier than businesses in other states.
Local small businesses projected one of the strongest business outlooks nationwide this spring, according to the recently released spring 2019 Bank of America Business Advantage Small Business Owner Report. Yet the report also found that entrepreneurs in Miami-Dade, Broward and Monroe counties are less confident in the economy, and have mixed views on the impact of last year’s landmark tax reform and trade tariffs.
The semiannual report was based on a survey of over 1,500 small business owners across the country and the greater Miami area. Below are some of the top findings for the tri-county area. How does your business compare?
- Over the next 12 months, 80% plan to expand their business. That’s down from. 89 percent in fall 2018 but 16 percentage points above the national average of 67 percent this spring.
- Sixty-nine percent believe their revenue will increase, down from 82 percent in fall 2018, but 10 percentage points above the national average of 59 percent this spring.
- Forty percent plan to hire. That’s down from 47 percent last fall, but the highest percentage among business owners surveyed in 10 local markets. [READ MORE: Hiring? It’s a jungle out there. Creativity may be key.]
- Twenty-seven percent plan to apply for a loan. That’s down from 30 percent in fall 2018, but the highest percentage nationwide this spring, 15 percentage points above the national average of 12 percent.
- Fifty-nine percent believe their local economy will improve, down from 67 percent in fall 2018, but 9 percentage points above the national average of 50 percent.
- Fifty-eight percent believe the national economy will improve, vs. 61 percent in fall 2018, and 10 percentage points above the national average of 48 percent.
- Top economic concerns include health care costs (67 percent), the political environment (62 percent), interest rates (52 percent) and corporate tax rates (51 percent).
“Local entrepreneurs are projecting a more cautious business outlook compared to last fall, but overall, they’re continuing to expand and hire at a higher rate than their peers nationwide,” said Odalis Martinez, Miami small business banker manager at Bank of America. “Overall, South Florida entrepreneurs’ more conservative business outlook echoes a nationwide trend of diminished economic confidence and cautious expectations.”
Sixty-two percent of South Florida entrepreneurs are concerned about the current political environment, though they are divided over how major policy issues are directly impacting them. Fifty-four percent of South Florida business owners say the new tax code has had an impact on their business — with 33 percent reporting that impact as positive. This is down from the 46 percent who anticipated a positive impact one year ago.
Regarding U.S. trade policy, 49 percent say they have been impacted by tariffs, with 19 percent reporting the impact as mixed, 17 percent reporting it as negative and 13 percent reporting it as positive.
And here is one area where South Floridians are far less optimistic than their counterparts in other states: 48 percent of South Florida entrepreneurs say they’re concerned about climate change impacting their business, the highest level of concern nationwide.
Most entrepreneurs in South Florida are preparing for the worst — but are they doing enough? Most South Florida entrepreneurs say they are taking steps to protect their business from potential threats such as natural disasters, an economic downturn or a cyber breach, but a majority of business owners do not have a plan to address reputational crises or challenges.
- Sixty-five percent have a business continuity plan in case of a flood, fire or other disaster.
- Eighty percent have taken steps to prepare for an economic downturn. That’s the highest percentage nationwide, and 11 percentage points above the national average of 69 percent.
- Eighty-five percent have taken at least one step to protect customer data from a cybersecurity breach, but more focus may be needed. [READ MORE: In the wild wild west of cyber attacks, ‘security is everybody’s job’]
- Only 40 percent have a plan to manage reputational issues and threats, That seems low but it’s the highest percentage nationwide, and 16 percentage points above the national average of 24 percent.