Big Fortune Awaits In SMB Market

Results of a first-quarter TEC poll of approximately 1,200 SMB CEOs reveal they're confident the U.S. economy will recover this year. Twenty-six percent of those CEOs believe the U.S. economy is already rebounding, and another 60 percent expect it to recover later this year. What's more, 95 percent of CEOs at IT-related SMBs believe the economy will recover by the second half of 2002. Encouragingly, IT (26 percent) and biotechnology (21 percent) were cited among the industries that respondents expect to rebound the fastest.

Surge In Sales Predicted

Hitting closer to home, 78 percent of SMB CEOs are predicting their companies' sales to increase during the next 12 months, TEC reports. Moreover, 44 percent are projecting sales gains greater than 10 percent.

"Anticipating the growth trend to continue and that interest rates will remain low, we are relatively optimistic for recovery through the next three to four quarters," says Lee Polevoi, associate director of communications at TEC.

The SMB market appears to be actively planning to take advantage of the expected upswing in business. A majority of the CEOs polled intend to reposition their companies to help accelerate growth (54 percent) as well as increase personnel (57 percent) during the next 12 months. In an effort to revitalize business, three in four plan to increase marketing efforts, and nearly half plan to enter new markets.

Looking ahead, 80 percent of the SMB executives report either no change or an increase in their capital expenditure plans for the next 12 months. Specifically, SMB end users are expected to spend more on IT in 2002. According to VARBusiness' recent research on IT spending and strategy, nearly one in two SMB executives expect the amount they spend on IT this year will be greater than it was in 2001 (see VARBusiness' April 29 issue for complete survey results).

The enterprise picture is not as bright: Only one in six large enterprises,those with $1 billion or more in annual revenue,plans to increase IT spending this year. Small businesses are also more likely than their large-enterprise counterparts to spend more of their IT budgets indirectly through a retailer, reseller, integrator or consultant this year than they did in 2001, according to VARBusiness' research (26 percent vs. 12 percent, respectively).

In addition to representing a very important customer segment, SMBs can help you grow your business by reaching an extensive audience and ultimately increasing your profitability. Are you tapping into these resources to rebound this year? Let me know at [email protected].