“As we embark on another uncertain year, it is more crucial than ever for small business owners to stay prepared through a focus on increased cash flow and a better understanding of how to handle their money,” said Kirk Simpson, co-founder and CEO of Wave. More than one in 10 (13%) of small business owners admit to keeping track of receipts by storing them in a drawer or shoebox. Amongst microbusinesses (defined by the US Small Business Administration as having fewer than 10 employees 2), less than half (48%) even have a small business bank account set up to run their finances. Over one in three (35%) admit to blurring the lines between their personal and business accounts, with 21% of respondents declaring this their worst financial habit. Financial bad habits range among small business owners: The number one worst financial habit for small business owners is not giving themselves a salary, with nearly one in four (26%) fessing up to this.
With that, some business owners are seeking new ways to get more digitally native and focus on becoming profitable, with 23% of respondents stating they plan to use bookkeeping software for the first time this year and 15% saying they will embed payments digitally to get paid faster.
Census Bureau, 5.4 million new business applications were filed in 2021, outpacing any year on record thus far. Those who could pivot were most likely to turn to a side hustle (54%) or digital revenue stream (24%) to keep their business afloat.Īccording to the U.S.
When it comes to preparedness, almost half (48%) of respondents said they would be unable to pivot to additional revenue streams in the wake of a financial crisis. This majority grows even larger when looking at business owners who are the sole employee of their company, with nearly seven out of 10 (69%) having less than $5,000 cash on hand.
While more than one in three (36%) of respondents were concerned about inflation impacting their business financially in the year ahead, the majority (57%) of small business owners have less than $5,000 set aside for financial crises. The study found that financial concerns abound for small business owners, yet many are not prepared to face them. TORONTO, Ap(GLOBE NEWSWIRE) - Wave, the one-stop money management solution for small businesses, today announced results from a survey 1 exploring the state of small business financial preparedness in the United States.