A report by Veem highlighting small business trends found that small businesses around the world are feeling optimistic about the future.
Covering small businesses in 110 countries, the report found that companies spent the second quarter of 2019 building inventory and increasing both the number of orders and the dollar value of each order. The average small business payments increased by 15% in the second quarter of 2019, according to the study, and the dollar value per order went to 6% in the second quarter.
For banks looking to lend to small businesses, there are positive signs that small business owners are looking to grow their businesses and will likely look for finances to do so, particularly if interest rates continue to decline.
Notably, Veem’s report also showed that small businesses in the United States are doing less business with the United Kingdom. The study showed that Brexit is taking its toll on the United Kingdom but is not affecting United States businesses. The United Kingdom dropped out of the top five countries for international transactions with the United States, India, Canada, the Philippines and China rounding out the top five.
However, small businesses continued to express concerns regarding trade negotiations with China, consistent with other studies reported on by Banking Exchange. More than three quarters of the small businesses polled showed concerns surrounding tariffs on Chinese products. However, this includes all 110 countries polled. It is not clear if American companies are particularly concerned. More than half of the small businesses said that that their businesses have already been impacted by tariffs.
The main day to day effect of tariff concerns has made businesses look closer to home for suppliers and outsourcing services. Nine out of ten small business owners stated that they were likely to look for a domestic supplier if tariffs increased by 25% of their products.
Veem’s report is a Small Business Transaction Report that tracks international payments data from more than 125,000 small businesses. The report is more focused on small businesses that have an interest in doing business beyond their domestic market, whether that is through producing products or seeking out global customers.
The findings in the report do show that the tariff talk, and the threat of a trade war are in fact effecting how businesses are looking to the future. The report also shows by their transaction flow, however, that small businesses seem to be growing and are optimistic about future growth.
- Balancing Act: Ensuring ECOA Adverse Action Compliance in the Age of AI Algorithms for Credit Decision-Making
- The Value of Embracing AI in Payments
- Tackling the Affordability Challenge with a Data-Driven Approach
- FHA Introduces Payment Supplement
- Banks Must Improve Digital Offerings to Meet Customers’ Expectations