AUSTIN, Texas--(BUSINESS WIRE)--ScaleFactor, the business OS and accounting app that enables businesses to operate in real time, today announced its inaugural ‘State of SMB Finance Report’ survey insights.
Data from the survey provides a comprehensive overview of current finance and business growth trends, including the usage and preferences of accounting software solutions.
The report is the result of polling 500 randomly-selected principal decision makers from U.S.-based SMBs with less than or equal to 500 employees surrounding the financial decisions impacting growth prospects.
SMB Data Indicates Growing Revenue and Conservative Hiring
The majority of survey respondents showed stable or growing revenue numbers for 2019 compared to that of 2018. Only 4% of businesses polled saw revenue decrease over 2018. Despite growth numbers, over 50% of businesses reported that they did not hire any new employees in the past 12 months.
Of business owners experiencing hiring impediments, the majority reported that the burden of salary costs was the top deterrent to hiring, followed by skills shortage and health care costs. Salary costs were reported as four times more likely to be a hiring impediment than the current competitive labor market.
State of SMB Finance Report Key Data Points
- 76% of businesses report no plans to hire a CFO in the future
- 58% of business owners currently use an accounting/back-office software platform, reporting time savings and fewer mistakes as the top benefits of use
- Technology implementation correlates directly with the size of the company, with 97% of medium-sized businesses utilizing an accounting technology platform
- The majority of small businesses are unaware of financial software’s capabilities, while 72% of medium-sized businesses report adoption of AI- or ML-based software
- Sources of growth funding widely varies by SMB size: 34% of very small businesses (VSBs) with 1-19 employees reported reinvesting company profits to finance growth funding, 43% of small businesses (SBs) with 20-99 employees reported using a credit card, and medium-sized businesses (MBs) with 100-500 employees reported that loans from financial institutions were used for financing growth
- Larger businesses tend to spend more as a result of the federal tax cut
- Top accounting software task is bookkeeping; invoicing and payroll follow closely behind
“The data from our inaugural report highlights the fact that small business owners have a lot on their plate, from running the business to performing back-office tasks,” said Kurt Rathmann, founder and CEO of ScaleFactor. “We are experiencing a new phase that focuses on capturing the efficiencies of an intelligent workforce through the use of insightful and prescriptive technology. Complex back-office operations can now be consolidated into one intuitive ‘business OS’ that provides a foundation for owners to focus on growing their business. Our innovative platform evolves best practices making it an exciting time to be an SMB owner.”
By providing useful business insights and managing all back-office tasks through their online bookkeeping software, ScaleFactor is committed to empowering small business owners to be proactive and to focus on growing their business. The company has seen a record 700% year-over-year sales growth based on same quarter sales, fueled by small businesses’ vast needs for more effective payroll and invoicing software.
For more information or to download the full report, please visit: ScaleFactor's State of SMB Finance.
ScaleFactor is on a mission to help small businesses scale faster. By automating complex accounting tasks and translating financial information into usable business insights, ScaleFactor is enabling business owners, managers, and entrepreneurs to focus on what they love — running and growing their business. Find out more about how ScaleFactor is solving the problems that businesses face every day at scalefactor.com.