New research from the National Federation of Independent Business (NFIB), sponsored by Wells Fargo, says the biggest problem is the cost of doing business
The study is conducted every four years. Respondents rated each of 75 possible business problems on a scale of 1 to 7, with 1 indicating a “critical problem” and 7 indicating “not a problem.” Problems are ranked according to the average rating received. The 75 business problems evaluated are organized into 10 problem clusters with each cluster containing all of the problems relating to a single topic.
Half of the top 10 problems worrying small business owners appear in the “costs” cluster, with the cost of health insurance continuing its 20-year reign as the number one problem for small business owners. More than 56 percent say it is a “critical problem.” Other cost issues in the top 10 include the cost of fuels and electricity, supplies, inventories and worker’s compensation insurance.
“For four years, the economy provided a good, stable foundation for small business owners to do business, but as it started to take a negative turn over the last several months, they felt the effects of rising costs of doing business as reflected by these results,” said Bruce D. Phillips, Senior Fellow at the NFIB Research Foundation and co-author of the report with NFIB Policy Analyst Holly Wade. “As the economic outcome remains uncertain, small business owners are searching for innovative ways to reduce expenses and increase sales."
The remaining top 10 problems fall into the “tax” cluster, including: federal taxes on business income, property tax (real, inventory or personal property), tax complexity and state taxes on business income. Tax complexity, a new problem on this year’s survey, ranks fifth on the survey and is a “critical problem” for 23 percent of business owners.
“As the economic downturn persists, small business owners are even more challenged by the costs of health insurance and the complexity of taxes,” said Rebecca Macieira-Kaufmann, executive vice president and head of Wells Fargo’s small business segment. “At Wells Fargo we believe it is vitally important to sponsor this research to promote a better understanding of the issues confronting small business owners."
For more information about the latest Small-Business Problems and Priorities , contact NFIB media department at 202-554-9000.
About the NFIB
NFIB is the nation’s leading small business association, with offices in Washington, D.C. and all 50 state capitals. Founded in 1943 as a nonprofit, nonpartisan organization, NFIB gives small and independent business owners a voice in shaping the public policy issues that affect their businesses. NFIB’s powerful network of grassroots activists sends their views directly to state and federal lawmakers through our unique member-only ballot, thus playing a critical role in supporting America’s free enterprise system.
NFIB’s mission is to promote and protect the right of our members to own, operate and grow their businesses. More information about NFIB is available online at www.NFIB.com/newsroom.
About Wells Fargo
Wells Fargo & Company is a diversified financial services company with $595 billion in assets, providing banking, insurance, investments, mortgage and consumer finance through almost 6,000 stores and the internet (wellsfargo.com) across North America and internationally. Wells Fargo Bank, N.A. is the only bank in the U.S., and one of only two banks worldwide, to have the highest credit rating from both Moody’s Investors Service, “Aaa,” and Standard & Poor’s Ratings Services, “AAA."
Wells Fargo is America’s #1 small business lender in total dollar volume according to the most recent Community Reinvestment Act data (2006) and the #1 SBA 7a bank lender in total dollar volume. Wells Fargo has loaned close to $36 billion to women, African American, Latino and Asian business owners since 1995. For more information, speak with a Wells Fargo banker, visit wellsfargo.com/biz or call the National Business Banking Center at 1-800-CALL-WELLS.