Merrill Lynch found that 56% of small business owners are doing better this year than last, with 34% saying their business is in the same shape as the previous year, and 9% saying it is worse. Even though more than half said they are doing better this year than last, 69% also said they were unable to hire as many employees as they would have liked, primarily due to a lack of business/revenue (32%).
The survey asked affluent small business owners their top business concerns, after customer satisfaction and employee payroll. They responded that providing their employees with health care was the next most important concern (46%), followed by providing a retirement plan (23%), and being able to sustain and build the growth of their business (19%). Merrill Lynch wanted to know why they felt providing health and retirement benefits were so important. Thirty-one percent said it was their responsibility as an employer and 20% said it was to attract and retain talented employees.
Lyle LaMothe, head of U.S. Wealth Management for Merrill Lynch Wealth Management, said in a teleconference this week that financial advisers should think of individual small business owners as “corporate entities,” but what makes it extra complicated is that they have their personal finances and business finances rolled into one ball. He said small business owners rely on advisers to keep all aspects of their finances afloat–and that their business plays a major role in their life as a whole.
When asked about the most challenging aspects of their lives, running a business came in second to raising children and was followed by maintaining a healthy marriage and a healthy lifestyle. (Thirty-one percent said raising children was most challenging, 28% said running a business, 14% said maintaining a healthy marriage, and 10% said maintaining good health.)
Because their business finances are so tightly woven in with their personal finances, more affluent small business owners than other affluent Americans who don’t own a small business needed to tap into their personal savings and investments this year (33% versus 18%). Twenty-four percent of small business owners expect their debt to increase in the coming year, compared to 11% of non-small business owners. And 32% of small business owners have had to increase their spending in the past year, whereas only 16% of non-small business owners had to do so.