Small businesses are a driving force of the economy. They make up 44% of America’s economic activities and create two-thirds of new jobs.
Choosing to start and run a small business is a significant and rewarding undertaking. Yet, as the BizFilings Small Business Survey 2020 shows, current and future business owners face many challenges.
The survey of 600 current and future business owners, conducted prior to the COVID-19 pandemic, sheds light on the motivations, fears, and concerns that these owners share. This includes deciding on a business location, choosing a business structure, monitoring and managing regulatory requirements, and more.
Fear of failure weighs heavy
Not surprisingly, in the digital age future business owners are planning for success by diversifying with a mix of online and bricks and mortar operations (57%). Yet, as they get started, a fear of failure weighs heavy among new business owners, with 39% citing it as a chief concern. “The work and time it takes to get off the ground” and “lots to do, more than I thought” were common sentiments.
Business registration is top of mind
Business owners are also being practical and forward-thinking about registering their businesses — one of the most important choices an owner can make. Most owners (60%) say they registered their business or plan to do so to ensure regulatory compliance, while 45% believe it inspires customer confidence.
According to our survey, the choice of business structure and registration status is largely impacted by how each owner and planner view their business and their need for liability protection.
Finding out what they don’t know
The survey also reveals an overwhelming need for guidance and proper resources, especially when it comes to laws, regulations, and taxes with 31% worrying about doing something wrong. “The use of resources for assistance can make all the difference in how a business is run and grows”, said one business owner. To keep up with changing business requirements, 61% say they are more likely to handle these tasks themselves or turn to the internet for help (52%).
Preparing for a remote workforce
We also look at the use of a remote workforce. Although not overwhelmingly widespread at the time respondents were surveyed, the current crisis has seen the popularity of telework skyrocket introducing a whole new set of compliance concerns and shining the spotlight on crisis planning.