Both small business owners and consumers nationwide are being impacted by the state of the economy. But despite concerns about prices and cash flow, shoppers continue to spend money and retailers remain optimistic.
A new survey by American Express, Amex Trendex: Small Business Edition, reiterates this trend.
“Small business owners are concerned about issues like pricing and cash flow forecasting, but they are overwhelmingly happy that they chose their career path as an entrepreneur, and most intend to be small business owners for the long run,” said Gina Taylor Cotter, EVP & GM, Small Business Products & Business Blueprint at American Express, in the report. “We also found that growing up with technology and social media has influenced how Millennials and Gen-Zers operate as small business owners: they are more likely to start a company right out of school and rely on technology to run their business.”
Small Businesses Stay Motivated
Pricing/price hikes (44%) and cash flow forecasting (35%) are small business owner respondents’ top concerns, which is consistent with Amex Trendex findings over the past year, the report states. Nearly 7-in-10 (68%) wish that they had more time to focus on their product/service vs. managing their businesses’ finances. But small business owners have a positive mindset despite these challenges: 95% of those surveyed are happy with their decision to start their company.
The Amex Trendex report also found that small business owners are motivated by their long-term ambitions. Six-in-ten respondents (60%) expect their business to be a long-term venture and run for more than five years. When asked about their long-term business goals, longevity rose to the top (49%), followed by becoming an established leader in their industry (32%) and growing their employee base (24%).
As for why owners chose to start their small businesses:
- 84% noted they were inspired by a personal passion
- 65% saw a need in their community
- 59% want to support their family and future generations
- 44% needed more flexible work
Technology Influences Small Business Ownership
Millennial and Gen Z small business owners surveyed are most likely to have learned about entrepreneurism online or on social media (56%), compared to Gen X and Boomers who knew an entrepreneur personally (47%), according to the report. While 74% of Gen X and Boomer small business owners surveyed had a traditional job (private sector, government, or another role in their current business) before starting their company, Millennials and Gen-Zers are more split and likelier to have started their business right out of school.
About 59% of Millennials and Gen-Zers surveyed had a traditional job before starting their business, but one-in-five (20%) Millennial and Gen Z small business owners indicated they were students or unemployed before starting their business (vs. 3% of Gen-Xers and Boomers), the report states.
The survey also found that Millennial and Gen Z small business owners, who grew up with technology, rely on it to run their business. When asked about the top contributing factors that helped them navigate the past few years, 33% of Millennials and Gen-Zers cited technology solutions vs. 18% of Gen-Xers and Boomers.
Millennial and Gen Z small business owners surveyed are also more skeptical about what it takes to be a successful entrepreneur than older generations, according to the report. They are about twice as likely to think that “you have to be wealthy to start a business” (21% vs. 9%), that “true entrepreneurs do it alone” (29% vs. 15%) and 33% think that “entrepreneurs are born and not made” compared to 22% of Gen-Xers and Boomers.
