Healthiest and Weakest Small Businesses Use Technology the Most

Healthiest & Weakest Small BusinessesThere’s a striking bifurcation among small businesses regarding how much they value technology and their financial performance.

According to a survey conducted in June, small business owners who expected their revenues for 2010 to increase by more than 25 percent over the prior year, as well as those who thought their revenues would decline by more than 25 percent, value technology (software, websites, social media)  at the same level of intensity. The survey of 1,200 small business owners was conducted by the Guardian Life Insurance Company of America.

In other words, owners of healthy companies and of firms on the skids both regard technology as more important to their business than the heads of other small enterprises.

For example, when asked “What matters most to you when it comes to technology?”, 5.1 percent of those expecting 25 percent or greater growth. However, 5.4 percent of owners anticipating a revenue decrease of 25 percent. They said “Using software to make my business more efficiently”.  Just 3.9 percent of those expecting a decline of 10 percent to 25 percent agreed with that statement.

Small business owners who plan to expand their business and those who plan to downsize also seem to be on the same page, at least when it comes to technology use. About 4.5 percent of owners planning to expand the business. Additionally, 4.2 percent of those planning to downsize use their websites to generate customer inquiries and sales vs. 3 percent of those who plan to maintain business as usual, for example.

Why do owners of thriving small companies seem to be so in tune with their counterparts at struggling firms? “On the one hand, small business owners feel that efficiency-boosting software, website utilization, and social media application can help them grow their companies. However, if they are planning to downsize, they can use those same tools to become more efficient and effective with less reliance on other resources,” says the report.

One other point: There also seems to be a connection between social media use and growth. Although a puny number of companies surveyed said they use social media, those that do were considerably healthier than those that don’t.  For example, 2.5 percent of owners are expecting to grow their business more than 25 percent. Said business owners claim that they are using social media to find out more about the marketplace. This is compared to -1.1 percent of owners who think revenues will drop by 25 percent.

The obvious moral: Those businesses that aren’t tech-savvy need to become educated adopters sooner rather than later.

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