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KeyBank surveyed small-business owners on important topics. Read what they said in our whitepaper.

Small-business owners face a variety of issues and challenges as they navigate the economy, plan for the future and react to changing federal policy. At the same time, many are enjoying unprecedented success in a consumer climate that is putting a renewed focus on small businesses and local connections.

To assess the general mood among small-business owners and determine what topics are most important to them, KeyBank has formed the Business Forum, a group of small-business clients who participate in surveys and provide feedback on current issues.

In this survey, we asked about topics ranging from the financial health of their businesses to their views on credit, interest rates and the new tax policy. The results tell us how the latest changes are impacting small businesses.

Feeling Good About Finances

When asked how they would rate the current financial health of their companies, 49% of respondents said they believe it is excellent or very good. The results are even better as they share their prediction for the next 12 months, with 57% seeing their future financial health prospects as excellent or very good.

That’s not to say that there are no challenges facing small businesses this year. Asked to identify their top two business challenges for 2018, 32% of those surveyed say improving cash flow and finding/ diversifying customers are equal at the top of the list. Similarly, 20% say hiring talented employees and balancing growth and quality are tied as the next two on the list. Based on the results, this group is least concerned with opening a new location or managing inventory.

Credit is Not a Big Concern

Regarding credit, the survey asked whether any new credit—such as a line of credit, business or equipment loans— had been obtained in the past 12 months. Only 19% indicated that they had secured credit, which came from a variety of sources, including KeyBank, and was used primarily to increase working capital.

The need for credit in the next 12 months showed a similar trend, with only 15% replying that they plan to need credit for their business. The fact that 60% of respondents say they are extremely confident or very confident they can get the credit they need shows that most are feeling they are in a good financial situation.

Anticipating a Rise in Interest Rates

All observers of the economy watch the Federal Reserve and that body’s decisions on interest rates as a good indicator of economic health and stability. Small-business owners surveyed were asked if they anticipate rates will rise, fall or hold steady. More than 60% say they expect rates to go up and 20% expect them to stay steady, but a majority—70%—are not concerned about repaying debt if the rates do rise.

New Tax Law Makes Sense to Owners

Changes to corporate tax policy, and specifically the new Tax Cuts and Jobs Act passed at the end of 2017, have been well covered by the media. It’s no surprise, then, that 76% of the survey group are aware of the tax reform. However, only 41% are likely to consider potential tax consequences before making important financial decisions about their business. How will small businesses adjust business plans and finances in response to the lower tax rate? Most will invest in facilities or equipment, expand their workforce or invest in current employees. Of the tax credits and deductions that are part of the new law, respondents will leverage miscellaneous deductions such as travel, subscriptions or meals, as well as charitable contributions.

What Does This Mean?

It appears that respondents are feeling optimistic, but since we’re in an environment of ongoing change, being nimble and informed are critical to success. Having the right team of experts in your corner can set you up to address the many challenges you may face. From managing cash flow to planning for the future, KeyBank’s team is ready to help your business grow and thrive.

Let KeyBank’s team of experts help you make the right decisions for your business. Contact your KeyBank Relationship Manager or visit

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