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Survey of Small and Midsize Businesses

Based on 953 surveys, completed between April and June, 1997

Economic Performance -- Growth over Past 12 Months
Percentage of respondents that had an increase in revenues, profits, employees, and employee compensation over the past 12 months.

Revenues
1993 -- 49%
1994 -- 60%
1995 -- 58%
1996 -- 61%
1997 -- 62%

Profits
1993 -- 39%
1994 -- 51%
1995 -- 50%
1996 -- 52%
1997 -- 53%

Number of employees
1993 -- 21%
1994 -- 20%
1995 -- 29%
1996 -- 26%
1997 -- 35%

Employee compensation
1993 -- 42%
1994 -- 42%
1995 -- 50%
1996 -- 52%
1997 -- 58%


Challenges to Growth and Survival
Percentage of respondents naming the following as one of the three most significant challenges to the growth and survival of their business.

41% The economy
37% Taxes
34% State and federal regulations
27% Lack of qualified workers
25% Labor costs
24% Access to adequate capital
24% Technology advancements
19% Maintaining quality standards
19% Health care insurance benefits
17% Motivating employees
15% Cost of training workers
2% Fraud
9% Other


Organizational Change
Percentage of respondents who indicated they made the following changes in the business over the last 12 months.

52% Upgraded computer systems
39% Increased productivity
36% Developed new products/services
29% Improved quality of product/services
24% Increased employee training
22% Increased employee motivation
19% Taking better advantage of the Internet
16% Increased capital investment (plant, equipment, R&D)
15% Expanded into new U.S. markets
9% Outsourced some part of the business
6% Opened new stores or branches
6% Instituted "Total Quality Management"
4% Expanded into markets abroad
3% Expanded through acquisition
3% Other
19% No substantial changes


Types of Financing Used
Percentage of respondents who used the following types of financing to meet their capital needs during the last 12 months

38% Commercial bank loan
34% Credit cards
20% Vendor credit
16% Private loans
16% Leasing
16% Personal or home-equity loan
4% Selling/pledging accounts receivable
4% SBA guaranteed loan
4% Asset-based, inventory or collateral
3% Private placement or stock
2% Venture capital
1% Public issuance of stock
30% No financing

DATA: ARTHUR ANDERSEN'S ENTERPRISE GROUP AND NATIONAL SMALL BUSINESS UNITED





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Updated Oct. 2, 1997 by bwwebmaster
Copyright 1997, Bloomberg L.P.
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