National Funding, one of the country’s largest private lenders of small business loans, today released the findings of a new survey on the holiday season outlook among small business owners, which found that over a quarter of small business owners are expecting better sales than last year.
According to the survey, most small business owners (88%) have a neutral to positive outlook for the upcoming holiday season, which speaks to the boost in consumer confidence, as well the improving economy.
David Gilbert, founder and CEO of National Funding, emphasizes that the holidays are one the busiest times of year for alternative lenders, with the bulk of business happening in the fourth quarter. Depending on the type of business, seasonal needs and customer demands drive many small and medium businesses (SMBs) to seek out additional financing during this time. With over 28 million1 small businesses in the U.S., revenue from the holiday season this year is expected to be in excess of $985 billion2.
The survey found that 4.3% of small business owners expected to borrow money over the holidays and more than 37% of those said they were not confident that their banks would grant them a loan should they need one.
“The truth is that 4.3% is probably under-reported because the majority of loans that arise during the holiday season are last minute. Whether or not a small business believes they will need to borrow money, owners should always be planning ahead and anticipate the need for financing. These days, they have more alternative lending options,” said Gilbert. “Most times, small to medium size businesses don’t need long term financing, especially during the holiday season. Alternative lending options, like working capital loans, merchant cash advances or small ticket equipment leasing, offer the flexibility and quick turnaround needed for owners to keep their businesses running smoothly.”
The survey also found that while many business owners research lending providers online, 53% of respondents stated that it was important to speak with someone personally about obtaining funding, rather than staying strictly online. Even more so, over half of the small business owners surveyed are not using the Internet for sales or servicing their customers.
“Despite the popularity of ‘online-only’ or an online component, many mom-and-pop shops prefer the in-store interaction with their customers, which is something we strive to maintain in our practices, as well,” added Gilbert. “At National Funding, we have a dedicated sales team that personalizes the customer experience, so they are comfortable, fully informed and equipped to make the best decisions for their business.”
Since 1999, National Funding has been a leading provider of financial services and products for small businesses, including, working capital loans, merchant cash advances, credit card processing, and equipment leases. The company commissioned the survey to better understand the attitudes of today’s small business customer during an especially busy time of year.
All figures, unless otherwise stated, were collected by SSRS Small Business Omnibus, an independent market research company. Interviews were completed via telephone with a nationally representative sample of 506 small business owners that have fewer than 100 employees. Fieldwork was conducted between October 13 and 28, 2014.