Though concerned about the domestic political situation, U.S. small and medium-sized enterprises (SMEs) are bullish about the current state of the U.S. economy and the outlook for business over the next 12 months, according to the latest Global Business Monitor report, an annual survey of SMEs undertaken by cross-border financing provider, Bibby Financial Services (BFS).
The study surveyed SME owners and decision makers in the U.S., Canada, the Czech Republic, France, Germany, Hong Kong, the Republic of Ireland, the Netherlands, Poland, Singapore and the UK.
Two-thirds (67%) of U.S. respondents describe the current U.S. economic performance as positive, up significantly from 50 percent in 2016. Three quarters expect positive performance to continue (35%) or improve further (39%) over the next 12 months. That upbeat assessment is reflected in favorable sales expectations – 63 percent of SMEs expect sales to grow over the next 12 months while only 7 percent anticipate a sales decline.
U.S. SMEs cite government regulation and rising overhead/costs as the biggest current and future business challenges while respondents were evenly split between those who believe that, overall, government policies are favorable (44%) or unfavorable (45%) to their businesses.
Ian Watson, CEO North America, Bibby Financial Services said: “In the U.S., our survey results find increasing optimism about the US economy on the part of many SMEs, perhaps stemming in part from the new Trump Administration’s emphasis on boosting American business and jobs, tempered by concerns about an uncertain political environment and the continued impact on their businesses of the regulatory burden and rising costs.”
Amid heightened political discourse on protectionism and the impact of international trade, the survey found the U.S. SMEs are heavily focused on the domestic market. Fewer than one in five of the surveyed business owners currently export or import and only three percent see export markets as their best untapped business opportunity. One quarter (25%) see government regulation and red tape as the greatest obstacle to international trade.
Watson added: “Given the sheer size and breadth of the domestic market, U.S. SMEs have historically been less focused or reliant on international trade than their counterparts in some other markets. While that domestic orientation is understandable, particularly given the relatively strong U.S. economic performance, U.S. SMEs should consider whether they may be leaving growth opportunities on the table by taking a step back on aggressively engaging international trade despite the challenges.”