Small business survey shows bounce back from COVID-19, especially in Florida
Small business owners have had a whirlwind couple of years, but for Jacksonville entrepreneurs like married duo Doug and Kristin McNaron, the future is brighter than ever.
The McNarons became first-time business owners just before the COVID-19 pandemic came to Jacksonville in March 2020.
“It was sort of panic, you know?” Kristin McNaron described seeing COVID-19 restrictions start to take place just weeks after she and her husband took over Java Game Haus Cafe, a game cafe that hosts various events. “Here we had bought a business that was very much based on social interaction. We had just put out a lot of capital and didn’t have a lot in reserves. It was pretty terrifying.”
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Two years later, though, the McNarons said they are considering an expansion — something they never would have imagined when they had to convert their storefront into almost a warehouse-like setup for online orders for a portion of 2020.
They aren’t alone in the reinvigoration for small businesses this year.
The eighth annual First Citizens Bank Small Business Forecast found 80% of business owners were confident in their businesses’ growth in the next year, which is a 2% uptick from 2021.
Doug Sprecher, sales strategy director at First Citizens Bank, said expansion is on the minds of 72% of small business owners, according to the report, which came as a bit of a surprise. This was a 10% increase from last year.
Of the five states in which the survey was conducted — California, Florida, North Carolina, South Carolina and Wisconsin — Florida had the highest increase in perception of success in the last 12 months. Floridians recorded a 25% increase since 2021 with 79% claiming a positive year in 2022.
“We see our small business customers growing. They’re seeing more activity and more customers,” he said. “The environment for small businesses in Florida is really good.”
Small businesses had a “great 2021,” said Lou Noir-Jones, North Florida market executive at First Citizens Bank,
“They overcame obstacles, and they’re optimistic,” Noir-Jones said. “What I continue to hear in our local market, especially from our small business owners, is that they’re very confident in Jacksonville and Northeast Florida.”
While uncertainty surrounding the ongoing COVID-19 pandemic remains among the top concerns facing businesses, it decreased from 52% in 2021 to 39% in 2022, the survey showed.
From fear to expansion
Doug McNaron said plans for Java Game Haus’ expansion came shortly after pandemic restrictions loosened.
“We just don’t have enough room,” he said. “When you’re a business and you’re turning away people at the door because you’re too packed on the weekends, that’s a good place to be.”
The business went from being in a “very scary place” to wanting to expand over the course of the last two years, and the McNarons said they are thankful to the community for their success.
Despite more small businesses like the McNarons’ planning for expansions, just 35% indicated they plan to do so by securing external funding sources, the First Citizens Bank survey showed.
“I have been really surprised by how robust this recovery has been,” Noir-Jones said. “Some of us could say this has been one of the greatest recoveries ever. Our businesses’ balance sheets [look good]. It’s just a matter of being cautious with all the risk out in the market right now.”
Of those planning to grow their businesses in the year ahead, not all are looking for more space. The survey showed most plan to do so through adding new products and services, hiring more employees or increasing their marketing/advertising budget.
Noir-Jones noted there is not much inventory in commercial real estate right now for small businesses looking to expand physically.
“It’s hard to find at the right price point, right square footage, right location,” he said.” We’re seeing a lot of construction activity, and construction’s not easy [because of] delays, cost overruns, etcetera. Sometimes business owners stress about not having enough business, and other times it’s [this].”
Local loyalty continues to drive positive sentiment with 85% of Florida respondents saying their state is a great place to start a small business, the highest number among those surveyed.
“We’re in a lot of really good markets,” Sprecher said. “We’re fortunate in that regard. I think we continue to see really strong performance out of our markets. More people move to Florida every day, and more businesses open to serve them.”