CLEVELAND, Nov. 12, 2020 /PRNewswire/ -- The COVID-19 pandemic has caused incredible strain for business owners across our nation, and the future of business is coming into focus as KeyBank learns more from women business owners and their own personal outlook. A recently completed survey shows confidence is falling compared to previous years of the same survey. In two years, we are seeing a 22% drop among respondents who say they are confident of their personal finances in the future. We are also seeing a 23% drop in those business owners who say they are confident in the financial health of their business over the last two years.
Full Survey Results: https://bit.ly/3pif1On
How Businesses are Adjusting
About one in three women-owned small businesses have low optimism that they will achieve their business goals over the next year, mostly due to the pandemic and economy. Six in ten women business owners report the pandemic directly impacted their business negatively. Among all respondents, the effects of the pandemic are creating three big challenges that stand out.
- 40% of respondents cite adjusting to a new operating model
- 36% say they are having trouble attracting customers
- 36% say they are having trouble maintaining staff productivity
For one in four women owned businesses right now, cash-flow management is a problem. Without that flow, many businesses are putting expansion plans on hold. In 2019, 90% of respondents said they planned to expand within the next two years. That has now dropped to approximately three-quarters.
Relying on Resources Available
As businesses focus on their current state of surviving this economic uncertainty, their relationship with their primary bank is becoming more important than ever. Confidence in the financial abilities of businesses are also falling. The ability to handle accounting and finances is down 11% from 2019. The confidence in ability to obtain credit is down 13% from 2019. The confidence in ability to conduct negotiations is down 10% in one year.
Among those surveyed, their primary bank relationship mattered for how they were supported when the pandemic hit. 53% reported their primary bank proactively reached out to them. 70% relied on their primary bank to some degree for financial guidance. "We understand how important the relationships we have with our clients are, not just in the tough times, but in the calm times as well," said Colleen Dugarte, Vice President and Senior Initiative Development Manager of Key4Women. "These results show us that being there in a time of need truly makes a difference, but more importantly, being there to meet the financial needs of women-owned small businesses in the time ahead is going to be just as critical."
Optimism has also faded among women business owners with age playing a critical factor in the responses KeyBank found. Overall, while only 46% of the total businesses surveyed were confident about achieving their goals over the next year, down from 71% just two years ago, it was millennial business owners who had more optimism. 60% of those under the age of 35 were optimistic towards the future.
It's difficult to put a time frame on anything right now as we don't know how this pandemic will evolve, and how quickly the medical solutions will come, but our respondents did give their best estimations for when they think business will return to normal for themselves.
- 1 to 3 months: 5%
- 4 to 6 months: 22%
- 7 to 12 months: 32%
- More than a year: 25%
- Maybe Never: 3%
- Already returned to normal: 8%
- Not affected by pandemic: 7%
Research for this survey was conducted by Schmidt Market Research, with a third-party panel, Dynata, gathering results from 305 total respondents. This survey was conducted in August of 2020. Please inquire for more information on breakdown of respondents by age and business' size by revenue.
KeyCorp's (NYSE: KEY) roots trace back 190 years to Albany, New York. Headquartered in Cleveland, Ohio, Key is one of the nation's largest bank-based financial services companies, with assets of approximately $170.5 billion at September 30, 2020.
Key provides deposit, lending, cash management, and investment services to individuals and businesses in 15 states under the name KeyBank National Association through a network of more than 1,000 branches and approximately 1,400 ATMs. Key also provides a broad range of sophisticated corporate and investment banking products, such as merger and acquisition advice, public and private debt and equity, syndications and derivatives to middle market companies in selected industries throughout the United States under the KeyBanc Capital Markets trade name. For more information, visit https://www.key.com/. KeyBank is Member FDIC. CFMA#201111-908781