Foodservice Equipment Reports

New Survey Cites Money Availability, Regulations As Challenging Business Growth

Small businesses are still struggling to get the money they need and to comply with government regulations, according to a survey by Babson College.

Company owners who took part in the survey said they've been able to get only about 40% of the money they requested from all sources, including loans and investor funding. The nearly 1,900 survey participants sought a median amount of $100,000, but received only $40,500. The survey also found that banks are companies' primary source of funding.

Businesses that seek funding are most likely to use it to supplement their cash flow or to buy real estate or equipment. In a finding akin to other surveys, only about 8% of the owners said they wanted money so they could hire more employees. Finding workers with the necessary skills continues to be a challenge, however, according to nearly half the survey participants.

Regulations take up an average of four hours of time each week, according to survey participants. Other findings showed that it's usually the small business owner who handles regulatory issues, complying with federal, state and local rules and tax laws. Nearly 60% of the participants found it difficult to understand and manage regulations and laws.

Nearly two-thirds of owners learn about regulatory changes from an accountant or attorney; just under half say they learn about them from trade associations. Other go-to information sources include chambers of commerce and local Small Business Administration offices. But just over a third of owners do their own digging to learn about regulations by surfing the Internet.

The Babson survey, conducted in March, drew companies from two groups; one included members of the Goldman Sachs 10,000 Small Businesses program, which is aimed at companies that want to grow, while the other group comprised companies not associated with the Goldman Sachs program.

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