Survey: The future looks bright for small to medium sized businesses

Written on Feb 08, 2018

Optimism is growing among small-to-medium sized businesses in 2018 in light of new tax reform legislation, according to a new survey of accounting professionals.

The survey by Right Networks, which sampled 365 accounting professionals at CPA firms and small-to-medium sized businesses, revealed that nearly 54% of SMBs felt “very confident” about the economy heading into 2018 compared to a year earlier. Over 70% of SMBs responded that they were either “very confident” or “moderately confident” in their business prospects for the upcoming year, compared to a year ago.

An overwhelming percentage of small-to-medium sized businesses cited winning new business and clients – while retaining existing customers – to be the top challenge for 2018. Over 44% viewed this as a priority in the coming year, with finding and retaining talent (19%) and dealing with rising health care costs (18%) as next in line.

The survey found that cloud applications are at the heart of expected SMB growth in 2018. Two-thirds of those responding reported they already use or plan to roll out a cloud-based accounting application in the coming year. Another 57% of the overall respondents indicated that they either use cloud storage or plan to this year.

Over 57% of responding SMBs indicated they work remotely every day, with another 21% indicating that they work away from their central office at least several times a month.

The survey found that nearly 40% of SMBs sampled believe taxes are the single biggest regulatory issue impacting their clients’ business today. Another 34% indicated that health care regulations were the biggest factor.

Additionally, nearly 37% of those responding felt there would be positive impact on their clients’ businesses from the new Tax Reform and Jobs Act, while another 40% are forecasting no impact. Only 23% saw a negative impact from the new code.

When SMBs were asked for their level of confidence in their own prospects heading into 2018, compared to 2017. Nearly 36% of respondents felt “very confident” about their outlook in the coming year while another 35% felt “moderately confident” about 2018.

As small businesses and medium-sized businesses move into 2018, addressing data security remains a high – if not top – priority. The survey found that nearly 34% regard data security and privacy as the biggest technology challenge from 2017. Handling workflow disruption (16%) and staying up to speed with current technology (14%) also figured prominently among SMBs as concerns from 2017 that figure to carry over into 2018.

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