The survey also indicated more Delaware business owners were feeling the impact of problems with the national economy than their counterparts in neighboring areas of Pennsylvania and New Jersey The regional survey includes questions on the challenges and opportunities facing small businesses in the Philadelphia region.
TD asked small business owners about their business goals for 2013 and 2014, hiring, expected impact of the Affordable Care Act, and the influence of the economy on their business.
The new Small Business Pulse Check polled more than 250 small business owners with revenue of $5 million or less in seven South Jersey counties (Atlantic, Burlington, Camden, Cape May, Cumberland, Gloucester and Salem), five Pennsylvania counties (Bucks, Chester, Delaware, Philadelphia and Montgomery) and the state of Delaware.
Results show that 48 percent of local small business owners expect to see revenue growth in 2014, but hiring optimism is lagging with 70 percent of those surveyed planning to maintain staffing levels next year.
“The TD Bank Small Business Pulse Check echoes what we hear every day from our customers in the tri-state area,” said Mike Carbone, regional president for TD Bank’s Metro Philadelphia market. “Many small business owners enjoyed a successful 2013, but still are exercising caution in the face of economic and legislative evolutions. TD’s local teams are in constant communication with small business owners to provide them with the financial support and guidance they need to strengthen and grow their businesses.”
Affordable Care Act
Six in 10 small business owners surveyed do not believe the Affordable Care Act (ACA) will impact their business. Of the one-quarter who anticipate a negative impact from the legislation, the majority are concerned about rising costs and impacts to financial bottom lines. However, only four percent of respondents indicated that the health care reform would limit or prevent hiring.
Fourteen percent of area business owners anticipate a positive impact from health care reform with additional coverage options and the ability to get insurance or offer insurance to employees being singled out as benefits of the ACA.
Impact of the U.S. Economy
More than one-half of the small business owners report that their businesses have been negatively impacted by the U.S. economy with respondents correlating the economic situation with declining sales and limited consumer spending.
In Delaware, 37 percent of small business owners reported a negative impact, compared with 19 percent in South Jersey and 25 percent in Philadelphia and its neighboring Pennsylvania counties.
“We know a large percentage of Philadelphia Region small business owners are sole proprietors, and more than half of them have two or less employees,” said Carbone. “In today’s environment, we know time is tight for entrepreneurs and that’s one of the reasons why TD Bank has always been committed to longer hours and industry leading convenience – we want be there when our customers need us.”
Female owned small businesses in the Philadelphia Metro Region are twice as likely to report revenue of under $50,000 per year (34 percent) versus male owned small business (17 percent).
Delaware small businesses are more likely to be structured as sole proprietorships (73 percent) compared to Philadelphia (46 percent) and South Jersey (47 percent).
Sixteen percent of Philadelphia region small businesses have applied for a loan/line of credit in the past 12 months and 19 percent intend to apply in the next 12 months.
Nearly one half (48 percent) of small businesses that applied for credit plan to use funds for product and equipment costs, followed by 36 percent who plan to use credit for marketing and advertising spending.
The study was conducted among a representative group of small business owners from the Philadelphia area, Southern New Jersey and Delaware between October 14th and 20th, 2013. Included were small businesses of $5 million or less in revenue, and 100 employees or less. The sample size of 251 has a margin of error of +/- 6.1 percent. The survey was hosted by global research company Angus Reid Public Opinion.