By Stephen Fournier – KeyBank Central New York Market President
It’s tough to be optimistic right now for many business owners. This year has brought about changes and pressures from the pandemic that are taking a major toll on women-owned businesses, according to the latest Key4Women Confidence Survey. Compared to previous years, confidence among women business owners in their personal finances is down 22%, along with a 23% drop compared to two years ago among owners who say they are confident in the financial health of their business.
What we’re seeing out of this pandemic is how resilient and capable of change so many businesses are, while also recognizing just how much relationships matter in supporting the needs or adjustments of our business clients. Since the point of the pandemic beginning, 70% of women business owners say they have relied on their primary bank to some degree for financial guidance. More than half of respondents say their primary bank proactively reached out to them when the pandemic struck.
The numbers show just how important the foundation of a relationship is for business owners to have with their primary bank. Obviously, the bulk in which we’ve seen this support has been through the highly publicized Paycheck Protection Program. More than one in three women small business owners in the Key4Women survey applied and received Paycheck Protection Program funding in the first wave. Nearly one in five relied on resources from state and local government. While government sources of support have been fully utilized, the demand still exists. 54% of respondents say they are likely to apply for additional funding, if it is made available again.
With support, adjustment to the pandemic has still not been easy. About one in three women business owners say they have low optimism that they will achieve their business goals over the next year. Six in ten report the pandemic directly impacted their business negatively. Among all respondents, the three top challenges posed by the pandemic include adjusting to a new operating model, having trouble attracting customers, and having trouble maintaining staff productivity. Many businesses are putting their plans for growth on hold for now as well. In 2019, 90% of respondents said they planned to expand within the next two years. That number has now dropped to approximately 75%.
That lack of faith in being able to expand and grow in the future is exactly where banks and financial institutions can help offer their support right now. Between the 2019 Key4Women Confidence Survey and right now, the confidence in the ability to handle finances is down 11%; the confidence in the ability to obtain credit is down 13%; the confidence to conduct negotiations is down 10%. These times are difficult for business owners, but banks understanding and knowing their clients in the ways that can help restore this confidence is a major key towards our collective recovery.
While this all may feel like a lot of doom and gloom, there is hope on the horizon. While we’re all glued to the herculean medical effort towards a potential vaccine, it’s the outlook of a majority of women business owners, 59%, who believe we could be back to normal business operations within the next year. Only 28% believe their business won’t be back to normal for more than a year. The remaining respondents either have returned to normal, or they weren’t affected by the pandemic.
Everyone has learned a lot from this pandemic. From the banks supporting clients in unprecedented demand, to business owners making necessary adjustments. We have experienced the acceleration of business trends, and in many cases, the abrupt halt of expansion and growth. These changes have shown how a business owners’ relationship with their primary bank has never been more important. Key4Women will continue to take steps to help support businesses with insight and advice for women in business to strengthen their networks.
About the author: Stephen Fournier is President of KeyBank’s Central New York Market. He may be reached at either 315-470-5096 or [email protected]. KeyBank is Member FDIC © 2020. KeyCorp.
SIDEBAR: Ways to Cut Heating Costs this Winter
1. Get a Smart Thermostat
Thermostats are different from 20 years ago. Today’s thermostats can be programmed from your phone and recognize your personal habits, adjusting the temperature of your house accordingly. Installing a smart thermostat may cost from $50 to $200, but should practically pay for itself over just a few months.
2. Seal Your Windows and Doors
Doors and windows are two areas where your home can leak significant amounts of heat – heat you’re paying for! Heat leaking out of the house can translate to a higher heating bill as your furnace must work overtime to make up for the escaping warm air. Doors and windows aren’t insulated the same way as walls, and are designed to open, producing natural cracks and spaces even when they appear firmly closed.
3. Dress in Layers
If you’re serious about cutting heating costs, consider lowering your home’s temperature by a few degrees, and just throw on an extra sweater and thick socks. After all, you’ll be wearing heavier clothes during the winter anyway, so why not wear them indoors as well? By doing so, you can be saving that 5 percent per degree all day long – every day.
4. Insulate Your Air Ducts
Are your air ducts and pipes wrapped in fiberglass or foam? If not, it’s time to get wrapping. Uninsulated pipes lose heat, and lost heat is lost money.
5. Pay Attention to Doors and Vents
Using internal vents and doors to control the area and flow of heat makes it easier to heat important areas at a cheaper overall cost. For example, you might not use your basement much in the winter, so by closing those vents you help force hot air toward your main living areas. The same goes for doors – leave the rooms open that you want to use in order to maintain a balanced heat, and close off the ones you don’t need as warm
