The annual issue of the Business Pulse Survey has been published by SunTrust Banks and it looks as if there has been a shift in the growth strategies of small and mid-sized businesses as they look to grow over the next five years.
According to SunTrust, of the 508 small and mid-size businesses that participated in the survey, thirty-six percent of companies with annual revenue of $10 million to $150 million are actively exploring mergers and acquisitions, an increase from 25 percent in 2015; while 41 percent of small businesses with annual revenue of $2 million to $10 million plan to introduce a new product or service, up from 31 percent. In a further shift, 29 percent of middle market companies are now looking to expand into international markets, while 32 percent of small businesses are looking to domestic markets to grow their business.
So are mid-size businesses looking to buy growth? “Business leaders are optimistic, with more than 80 percent saying their businesses are strong and they are confident about their company’s finances,” said Beau Cummins, commercial and business banking executive at SunTrust. “Along with the belief that capital is accessible, this is changing the way companies are approaching growth over the next five years. We see interest in mergers and acquisitions on the upswing for middle market companies and plans to grow organically significantly decreasing. We also found that growth through bank or private equity funding is anticipated by both sectors.”
Other findings of the Business Pulse Survey include the following top business goals: Growing profitability (27 percent); growing revenue (25 percent); increasing customer satisfaction (21 percent); and investing for future growth and expansion (19 percent). Optimism abounds with 80 percent of business leaders confident that their business goals will be achieved.
What keeps small business leaders up at night? According to SunTrust, most are concerned about uncertainty in the economy (68 percent), changes in the healthcare laws (68 percent), cash flow stability (66 percent) and employee morale (65 percent). Mid-market business leaders’ concerns also include fraud protection and cyber security (72 percent).
SunTrust provides deposit, credit, trust, investment, mortgage, asset management, securities brokerage, and capital market services. As of December 31, 2015, SunTrust had total assets of $191 billion. The bank is headquartered in Atlanta (www.suntrust.com).
For a copy of the 2016 Business Pulse Survey click HERE.
© 2016 Private Equity Professional • Private Equity’s Leading News Magazine • 3-24-16