According to the results of the 2024 Small Business Survey released by TD Bank, a large majority of small business owners (SBOs) have a positive outlook on the future of their business. 90% of small the SBOs surveyed noted their optimism for the future of their business in the next 12 months, which is up from 80% in 2023, indicating a light at the end of the tunnel following prolonged turbulence in the economic environment.
Alongside their positive outlook, the survey found that SBOs are also optimistic about the following areas of their business:
- Revenue: 64% of SBOs foresee their business revenue and sales increasing in the next 12 months.
- Growth Opportunities: When it comes to expanding products and services, 59% of SBOs noted that they plan to do so in the next twelve months, indicating that small businesses are honing in on growth tactics as the macroeconomic environment levels out.
- Closures and Layoffs: SBOs are showing an overwhelming sense of confidence around their business’s health, with 94% noting that they have no plans to sell or close their business in the next 12 months. Similarly, only 4% plan to reduce their staff.
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Inflation’s Continued Effects
“While many small businesses remain optimistic heading into the second half of 2024 and 2025, they have continuing concerns about interest rates, inflation and economic pressures. However, SBOs’ optimism surrounding revenue and business growth is a testament to the resiliency of small businesses who have weathered tough economic circumstances and proven their ability to effectively navigate a challenging economy,” Chris Giamo, head of commercial banking at TD Bank, said. “We aren’t in uncharted territory — business owners who have a strong relationship with their banker remain informed of the economic landscape and able to leverage resources that will help them maintain and grow despite the challenges.”
Despite increased optimism around their businesses, persisting inflation continues to weigh on SBOs. More than half cited both inflation and interest rates (56%) and the increasing costs of supplies, materials and equipment (58%) as top concerns.
Data from the survey highlights the impact these macroeconomic conditions have on SBOs, with 64% noting they will have additional credit or financing needs over the next 12 months. Of those SBOs, 50% noted that this loan or line of credit would be used to maintain company operations, with others noting they’d use the funding or credit to support expansion into new market verticals (47%) and launching a new product or service line (45%).
“As small businesses continue to grapple with lingering economic headwinds, having a trusted financial institution in their corner for continued guidance and financial support is crucial,” Amy Dinkar-Patel, head of small business and commercial distribution at TD Bank, said. “It’s a promising sign that almost half of business owners are looking for financial support to invest in growth objectives. But whether they’re looking to expand or equip themselves with financing solutions, TD is committed to helping our small business customers through every phase of their business’s life.”
Trusted Relationships Are Key
In a shifting, uncertain economy, SBOs rely heavily on their primary financial institutions to help them with their business functions and health. Customer service in particular is weighted heavily among business owners, with 62% noting it as a top function they look for in a bank, along with competitive rates (64%) and technical products and services that help them manage their business (49%).
The survey also found that SBOs continue to have faith in their banking partners and the value they offer, with 19% considering changing the primary financial institution they use for business purposes within the next year. Additionally, 95% of SBOs who noted they will apply for a loan or line of credit in the next 12 months are confident they would be approved through a big, mid-size or small regional bank — emphasizing their confidence in their financial health and in their bank’s ability to support their business.
“One of the most important relationships business owners can develop is with their bank,” Dinkar-Patel said. “The right customer-banking relationship fosters trust, unlocks tailored financial solutions and ensures a deeper understanding of the business’s unique needs. The relationship between a small business owner and their bank isn’t just a financial necessity—it’s the cornerstone of enduring success, allowing business owners to weather inevitable storms with confidence.”
Survey Methodology
This report presents the findings of a CARAVAN survey conducted by Big Village among a sample of 1,014 small business owners and partners. The survey was conducted between April 3 – 15, 2024. Small business owners are defined as respondents having less than 100 employees with a recent fiscal year revenue between $250,000 and $5 million.
