Back at the beginning of last November, Equifax, a firm specializing in credit intelligence (an oxymoron, if there ever was one), published some data about small businesses. The report found that, at 9,361, the number of bankruptcy filings for small businesses in September was up 27 percent on the same month in 2008. Comparing the entire third quarter of 2009 with that of 2008, the rise was a full 44 percent.
In an accompanying statement (if only of the obvious), Dr. Reza Barazesh, head of North American research for Equifax's Commercial Information Solutions division, said:
Economic pain is continuing for small businesses across the country. We're still seeing hefty increases in the number of bankruptcies in a lot of major metro areas.Much Left to Discover
Fast forward to December 28, 2009, and a press release from Discover Financial Services, "a leading credit card issuer, and electronic payment services company." It carries out a regular survey, called Small Business Watch, which monitors the opinions, and attitudes of those who own SMEs.
The press release's opening paragraph started:
Economic confidence among America's small business owners was steady in December as fewer of them believed the U.S. economy was getting worse compared to November, and more saw conditions for their own businesses getting better in the next six months, according to the Discover Small Business Watch.Phew! So everything's all right again. Economic panic over.
Devil in the Detail
But wait. Read a few lines down, and details emerge. For instance:
22 percent see conditions for their own businesses getting better in the next six months, an improvement from 19 percent in November; but still in contrast to the 52 percent who see conditions getting worse, 24 percent who see things staying the same, and 3 percent who aren't sure.So maybe it's a little early to be popping Champagne corks.
Small Business Loans Still Not Fit for Purpose
The reality is that business funding remains a serious issue for all too many SMEs. Banks are still not lending to many good, solid customers.
If you're struggling to find the money to run or grow your business you may want to think about the pros and cons of a merchant cash advance.
2 comments:
More good news for MCA vendors. Up until now, small business had to adjust their sales structure to meet the demands of loan funds. With the word of MCAs being spread around, small business CEOs can structure their financing around the needs of their businesses.
I predict this 'wall' of inactivity will come down soon enough. The big banks will realize its in their best interest to free up some of their capital for the small businesses that have traditionally been some of their best customers.
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