Small businesses respond to economic uncertainty

Business owners are still concerned about what’s next—but are pressing forward. Highlights from our eighth annual survey show how they’re approaching 2024.

According to respondents to Truist’s 2024 survey of 844 small businesses, small business owners are still worried about the economy, inflation, rising prices, and the impact on their businesses—but they’re also somewhat positive about the future and are investing in technology and new markets to keep growing. Check out the results^{Disclosure 1} of our small business survey to see how.

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Small business owner confidence is waning in 2024 as owners look to an uncertain economy. What’s behind that concern, and how are they preparing for the coming year?

The annual Truist survey of small business owners, conducted in February 2024, asked 844 owners (annual revenues between $100,000 and $10 million) about their plans for their businesses for 2024.

Key takeaways

Small business owners surveyed told us they’re:

Concerned about inflation, rising costs, and the economy
Addressing inflation through price increases and spending cuts
Weighing the possibilities and perils of artificial intelligence (AI) technology for their businesses
Looking to growth opportunities internationally
Retaining staff not just with pay, but with perks as well
Taking action to achieve work-life balance

Find out more about what small business owners expect in 2024.

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Small businesses act to get ahead of economic uncertainty.

2024 trends

Small businesses surveyed told us what they’ve experienced in the last year and how they’re approaching 2024:

Confidence in their businesses and the current economy is down compared to last year.
Stress levels are on the rise with 57% extremely/somewhat stressed, with top concerns being rising costs, inflation, and economic uncertainty.
62% expect business conditions to improve in the coming year.
90% have reacted to inflation by taking actions such as raising prices, cutting costs, or increasing efficiencies.
Higher prices have not driven away customers but have impacted the frequency and size of purchases.
32% see the potential of AI to help their businesses find efficiencies and better understand and serve customers.
44% are doing business internationally, with 59% sourcing materials or products internationally and 28% sourcing labor or services from foreign suppliers.
71% reported a cash shortfall during the year.

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Top investments to achieve business goals

Percentage of small businesses surveyed investing in:

Increasing sales efforts

39%

Boosting digital marketing

24%

Purchasing or leasing new equipment

23%

Infusing capital

20%

Developing products or solutions

20%

Improving internal processes

19%

Education and training

17%

Technology including AI

16%

Looking for more resources?

Find the bank account that best fits your small business.

Read “Financial levers to manage the effects of inflation.”

Watch the “Small Business, Big Heart” web series.

Get advice from a Truist branch teammate or virtual Small Business consultant.

Boosting productivity and profits

Small business owners in our survey are searching for opportunities to increase the profits their businesses generate.

Track and cut. 55% of owners say their top action to improve profitability is to track and cut major types of expenses.
Benchmark competitors. Owners say their next priority for finding additional profits is to check processes against their competition.
Monitor cash. 45% of owners use monthly business cash flow statements to find profitability improvement opportunities.
Rethink value. Owners are evaluating the value they deliver to customers to find ways to boost value or increase the prices they charge.
Budget. 41% of owners use a financial plan and budget to manage their profit goals.
Cash reserves. 89% of owners agree having cash reserves is a smart move, and a majority of small business owners do have some cash set aside.

Marketing and sales investments to grow revenue and profits

Percentage of owners surveyed planning 2024 investments in:

Advertising

44%

Improving website

39%

Building online/social media presence

36%

Networking/developing referrals

29%

Developing products/services

29%

Enhancing e-commerce

20%

Looking for more resources?

Earn rewards and more with a Truist small business credit card.

Read “Speed up the flow of cash into your business.”

Read “5 ways to save that business owners often overlook.”

Gain greater control of your business finances with small business online banking.

Varying levels of risk preparedness

Owners surveyed are taking steps to mitigate risk and avoid becoming victims of fraud.

Prepared for loss. More than half of owners say they are somewhat/very prepared for loss of a key customer, suppliers, or employee, and for fraud or an information breach.
Disasters and downturns. 41% of owners say they are somewhat/very prepared for a natural disaster, and 42% believe they are somewhat/very prepared for an economic downturn.
Fraud attacks. 9% of owners have experienced financial and/or cyberfraud within the last 1 to 2 years, and 88% of owners have taken some kind of action to prevent fraud.
Losses and recovery. 37% of owners who experienced fraud had losses of $50,000 or more, and insurance covered at least some of the losses for 81% of businesses that experienced losses due to fraud.

Actions taken to prevent fraud

Percentage of owners surveyed who have taken this action to prevent fraud:

Actively monitor account balances/transaction status

50%

Secure business computers with password protection

50%

Periodically change passwords

47%

Use online banking services

44%

Frequently reconcile statements and accounts

39%

Educate employees about fraud

25%

Secure check stock

23%

CPA performs fraud audits

16%

Separation of duties

15%

Looking for more resources?

Protect your business with insurance coverages tailored to your needs.

Read “Be fraud aware.”

Read “5 ways to tighten your business’s cybersecurity efforts.”

Get advice from a Truist branch teammate or virtual Small Business consultant.

What growing businesses are doing

For small businesses looking to grow, studying companies that have demonstrated growth allows them to extract lessons for their own businesses.

According to Truist’s 2024 survey^{Disclosure 1} of 844 small business owners, businesses that grew revenue between 2022 and 2023 by 20% or more (97 survey respondents) think and act differently than the rest of the surveyed businesses that didn’t grow that quickly (747 survey respondents). Here’s how the fastest growing businesses from our survey were different from other businesses.

Fast-growing businesses surveyed are different than slower-growing, non-growing respondents, or shrinking businesses in that they:

Outlook

Are optimistic about the national economy (78% more likely than other respondents) and the financial well-being of their company versus a year ago (47% more likely). They are less stressed (48% less likely) and less likely to be concerned about economic uncertainty (42% less likely), inflation (55% less likely), and rising costs (33% less likely).
Focus on finding new customers (41% more likely) and meeting customer expectations (96% more likely).

AI

See AI as important for their business (122% more likely).
Look for AI to provide an increase in productivity (36% more likely) and the ability to compete with larger businesses (119% more likely).
Use AI (81% of fast-growing businesses are using AI, versus 57% of other respondents). Top AI applications for the fastest growing businesses are order processing, marketing (blog writing, content creation, etc.), obtaining business insights, and supporting customer service.
Express concern that AI will discourage employees (31% of fast-growing businesses, versus 11% of other respondents) and will use internet bandwidth (26% of fast-growing businesses versus 18% of other respondents).

Workforce

Attract and retain workers with more clearly defined career paths (67% more likely), hiring bonuses (57% more likely), and profit sharing (97% more likely).
Actively use AI to offset labor shortages (236% more likely) and to replace workers with automation (250% more likely).

International

Are engaged in selling products or services internationally (222% more likely), with 43% saying international sales make up more than half of company sales.
Source materials and products internationally (82%, compared to 35% of all other respondents), and source labor and services internationally (60%, compared to 23% of all other respondents).

Business growth goals

Have business growth goals (96% of fast-growing businesses) and a written out and/or publicly stated growth plan (70% of fast-growing businesses).
Have growth goals that include attracting outside investors (117% more likely), expanding rapidly to be a market leader (68% more likely), and engaging in a strategic partnership or merger (104% more likely).

Looking for more resources?

Need funding for business growth? Explore these options.

Read “The secrets of growing businesses: how they are finding success and rapid growth.”

Read “Get growth in gear with the Growth Plan Builder.”

Get advice from a Truist branch teammate or virtual Small Business consultant.

Hitting the links

Watch Braves third baseman Austin Riley and our Head of Small Business Scott Stearsman connect with three veteran small business owners over a great round of golf.

Transcript

Hey, guys.

Austin Riley, third baseman for the Atlanta Braves.

And today I'm teeing off for Truist.

My teammates are six veterans who I think are American heroes

Keith Marshall.

My background is in the United States Air Force.

I served four years,

two tours in Desert Storm, Desert Shield and Operation Southern Watch.

My name is Paul Pelletier.

Short time in the Marine Corps, but had a profound impact on my life.

My name is Leland Rice.

Army veteran. I spent 20 years in the Army.

I worked in, Hawk missile system, Air defense artillery branch.

Veterans are important to Truist because they're the ultimate heroes.

At Truist our small businesses are Our heroes,

and they are The heartbeat of our communities.

And a veteran owned small business is the ultimate superhero

because of the service they provide to our country,

as well as the service they provide to our community.

At the

end of the day, one of the things in the military you can't do is stop.

You can't quit.

The mission is the mission whether you sleep or you don't sleep.

I did telecom in the Air Force.

Desert storm, Desert Shield.

And then Operation Southern Watch.

Two tours, two holiday seasons over there.

I joined when I was

18, got out about four and a half years later.

They put me through college and I started training with,

weight on my back, getting ready for my summer duty

and developed compartment syndrome in my leg 40 years ago.

It wasn't an elegant way to fix it. Really.

They kind of hired me to do the same thing I had been doing.

Which was logistics resupply, ammo, fuel, food.

Strategic logistics. Support.

Yeah.

For deploying and deployed units.

Come on.

What was your favorite part about today?

You know,

like I said, I think just, you know, spending some time with the veterans.

You know, I'm a big believer and, you know, those guys are the true heroes.

And getting to hear a little bit of those stories of what they've

what they've gone through, what they've sacrificed.

You made my day.

And I know you made six clients’ day

today as well, so I appreciate the partnership.

Thank you.

You guys are the reason why I get to do what I do.

And I appreciate everything.

Get your business ready for the year ahead.

Our teammates are ready to support you with advice to help you as you prepare for the coming year and beyond. Set up an in-person or virtual appointment, call 844-279-8204 to speak with a Small Business consultant, or visit Truist Small Business to learn how we can help your business reach its goals in 2024.

Small businesses respond to economic uncertainty

Key takeaways

Small businesses act to get ahead of economic uncertainty.

2024 trends

Top investments to achieve business goals

Increasing sales efforts

Boosting digital marketing

Purchasing or leasing new equipment

Infusing capital

Developing products or solutions

Improving internal processes

Education and training

Technology including AI

Looking for more resources?

Boosting productivity and profits

Marketing and sales investments to grow revenue and profits

Advertising

Improving website

Building online/social media presence

Networking/developing referrals

Developing products/services

Enhancing e-commerce

Looking for more resources?

Varying levels of risk preparedness

Actions taken to prevent fraud

Actively monitor account balances/transaction status

Secure business computers with password protection

Periodically change passwords

Use online banking services

Frequently reconcile statements and accounts

Educate employees about fraud

Secure check stock

CPA performs fraud audits

Separation of duties

Looking for more resources?

What growing businesses are doing

Outlook

AI

Workforce

International

Business growth goals

Looking for more resources?

Hitting the links

Get your business ready for the year ahead.

Disclosures

Investment and Insurance Products:

Limited English Proficiency Support:

New York City residents:

Borrowers with Limited English Proficiency (LEP) needing information can use the following resources:

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