Companies exhibit increasing confidence in their business and economic prospects.
Revenue and credit requirements are projected to rise as firms solve difficulties and grow.
NEW YORK— The JPMorgan Chase 2022 Company Executives Outlook Survey released today indicates that small and midsize U.S. business leaders are confident in their enterprises and resourceful in handling macroeconomic problems.
The majority of corporate executives are positive about their own success in 2022, up from 77 percent and 63 percent one year earlier. Comparatively, business executives are more optimistic about their industry’s success and the local, national, and worldwide economies. Despite the uncertainty caused by COVID-19, companies are optimistic about the next year, with 80% of midsize and 63% of small enterprises expecting revenue and sales growth. In accordance with these development ambitions, over 40% of those polled expect credit requirements to rise in 2022, the biggest percentage in five years.
“Businesses have been essential accelerators of the sustained economic recovery,” said Jim Glassman, head economist, JPMorgan Chase Commercial Banking. Having a better grasp of how to remain competitive in today’s economic climate should help them to build on last year’s success.
More than half (53%) of midsize enterprises are running at or above pre-pandemic levels, with nearly one-third (31%) running at or above pre-pandemic levels, demonstrating that some organizations have leaned into the disruption and continued to develop. 70% have seen profits recover to pre-pandemic levels or exceed them. 9 out of 10 midsize enterprises anticipate to expand in 2022, with the most popular growth drivers being expansion into new markets or geographies, innovation or product and service diversity, and higher customer demand.
Managing Economic and Operational Risk
All firms, regardless of size, had to negotiate an unpredictable and obstacle-filled operating environment last year. Here are the top three difficulties facing SMBs.
Top Business Challenges
- SMBs
- SMEs
- Uncertainty in
- Labor crunch
- Inflation
- Supply chain concerns
- COVID-19 shifts consumer habits
- Increasing company costs
Small and medium enterprises have changed their business strategies to address today’s problems.
Over half (51%) of small enterprises have acquired suppliers from new areas to ease supply chain interruptions. Many have also raised budgets to cover expenses associated with shifting items (48%) and changing materials or production methods (32%). (30 percent ).
Employee Rewards: Concerned about recruitment and hiring, 81 percent of midsize enterprises and 38% of small businesses have raised pay or plan to do so. Flexibility is also an important issue for many company owners, with 44% of midsize organizations currently offering or planning to offer employees more flexible hours. Small firms have increased employee perks including health insurance (61%) and 401K plans to retain personnel (37 percent ).
While small companies are concerned about how COVID-19 could affect customer preferences, they are increasingly using digital platforms to contact consumers. Nearly one-quarter (24%) of small firms have improved sales on social media channels. 19% aim to go to virtually 100% e-commerce in the next year, up from 12% last year.
Small Business Financial Needs
Small company owners will need to find new sources of capital in the next year. 7 in 10 (69%) intend or require funding in 2022, up from 59% last year, with software systems and development being the biggest demand (23 percent ). Nearly half of small firms expect to use business credit cards to help fund purchases, up from 38% last year, with line of credit funding coming in second. Small firms (68%) want to investigate internet lending possibilities, up from 56% a year earlier.
C.E.O. of Chase Business Banking Ben Walter: “We are thrilled to see small business confidence improving.” We are delighted to help our clients as they handle supply constraints, modify local safety regulations and discover inventive methods to acquire personnel in a limited labor market. Chase is eager to assist when confidence grows.
New Year, New Thoughts
Businesses should plan for the following in 2022:
