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NEW NATIONWIDE SURVEY FINDS SMALL BUSINESSES OPTIMISTIC ABOUT U.S. ECONOMY; SMALL MANUFACTURERS LEAD THE RESURGENCE

 MALVERN, Pa., Jan. 25 /PRNewswire/ -- U.S. small businesses are optimistic about the direction of the nation's economy and expect higher sales in 1993 according to Principal Opinions(TM), a nationwide telephone poll of small business owners conducted by Madway Business Research, Inc. and Research Corporation of America.
 The survey of 1,009 companies with 300 or fewer employees also found that 22 percent of the nation's small businesses plan to increase the size of their work force during the first quarter of 1993, and 29 percent have specific plans to expand during the first half of 1993. Small manufacturers are leading the resurgence as one-third plan to increase hiring in the first quarter and 44 percent plan to expand.
 Forty-seven percent of the small businesses surveyed expect the U.S. economy to improve during the first half of 1993, while only 12 percent expect the economy to decline. Optimism is higher among small businesses with 100 to 300 employees, where 59 percent expect the economy to improve in the next six months, than among firms with under 100 employees (47 percent). Retailers (53 percent) and manufacturers (49 percent) are more positive about the economy than are service firms (42 percent).
 Small business owners are very upbeat about the outlook for their firms in 1993. Over half (53 percent) of the small businesses surveyed expect their company's sales to increase in 1993, while only 6 percent expect sales to decline. This represents a significant improvement from the results of this past year in which 42 percent of the nation's small businesses experienced higher sales and 20 percent experienced lower sales, according to the poll. Among those firms forecasting higher sales, 54 percent expect sales to increase by more than 10 percent, and 38 percent expect the increase to be in the range of 5 percent to 10 percent.
 Manufacturers and retailers are more positive about the prospects for their companies than are service companies. Sixty-two percent of the manufacturers surveyed and 60 percent of the retailers expect higher sales in 1993, compared to 47 percent among owners of small service companies. Company size also has a significant impact on outlook. Among small companies with 1992 revenues of $1.0 million or more, 70 percent expect higher sales in 1993, compared to 49 percent among firms with under $1.0 million in revenue.
 HIRING OUTLOOK IS ENCOURAGING
 Approximately one-in-five small businesses plan to increase their employment during the first quarter of 1993, while only 4 percent expect to decrease their work force. The employment picture brightens as company size increases: 32 percent of the small businesses with 100 to 300 employees expect to increase their work force compared to 22 percent among firms with under 100 employees. The outlook is even more favorable among small companies with 1992 revenues of $1.0 million or more where 38 percent plan to increase employment during the first quarter.
 Job growth will be highest among small manufacturers and construction firms. One-third of the manufacturers and 31 percent of the construction firms surveyed plan to increase employment this quarter, compared to 22 percent among service firms, 21 percent among distributors, and 15 percent among retailers.
 The hiring picture is somewhat brighter in the Midwest and Northeast, where the net difference between the percentage of firms planning to increase employment and the percentage of firms planning to decrease employment is 20 percent. However, in the West, the gap is only 13 percent, as 21 percent of the small companies plan to increase their work force and 8 percent plan to decrease employment.
 MANUFACTURERS LEAD THE WAY IN EXPANSION
 Twenty-nine percent of the small businesses surveyed plan to expand during the next six months. Approximately one-third (32 percent) of the companies planning to expand expect to enter a new market in the next six months, and 24 percent expect to undertake some type of real estate- related expansion, such as moving, buying additional real estate, or enlarging their current space. Another 22 percent plan to introduce a new product or service.
 Expansion plans vary considerably by location, firm size, and industry. Thirty-six percent of the small businesses in the West plan to expand, compared to 32 percent in the Midwest, 28 percent in the South, and only 23 percent in the Northeast. Among firms with 100 to 300 employees, 40 percent plan to expand, compared to 29 percent among firms with under 100 employees. Thirty-eight percent of the small businesses with 1992 revenues of $1.0 million or more plan to expand compared to 27 percent among firms with under $1.0 million in sales.
 Manufacturers and construction firms are much more likely to expand during the next six months than other industry sectors. Forty-four percent of the manufacturers surveyed and 42 percent of the construction companies plan to expand, compared to 29 percent of the service companies, 26 percent of the distributors, and 18 percent of the retailers.
 These results are based on telephone interviews with a random sample of 1,009 small business owners from across the United States. Interviewing was conducted from Dec. 13 through Dec. 21, 1992. For results based on a sample of this size, the maximum error range is +3 percent at the 95 percent confidence level.
 Principal Opinions(TM) is a monthly small business outlook poll recently started by Madway Business Research, Inc. and Research Corporation of America, two market research firms and opinion polling companies located in the Philadelphia area. An in-depth report on the survey results, including analysis broken down by U.S. Census sub- region, will be released on Feb. 1, and can be obtained by contacting Madway Business Research at 215-648-3865 or Research Corporation of America at 215-828-7799.
 PRINCIPAL OPINIONS(TM) POLL RESULTS SUMMARY -- DECEMBER, 1992(A)
 All small Companies Companies
 businesses with 1-99 with 100-300
 employees employees
 General economic conditions in the U.S. -- next six months:
 Better 47 pct. 47 pct. 59 pct.
 Worse 12 12 6
 About the same 36 36 30
 How will your company's sales in 1993 compare to sales in 1992:
 Higher 53 pct. 53 pct. 59 pct.
 Lower 6 6 5
 About the same 38 38 33
 Expected increase in sales in 1993 -- percentages based on companies
 forecasting an increase:
 More than 10 percent 54 pct. 54 pct. 47 pct.
 5 to 10 percent 38 38 41
 Less than 5 percent 5 5 11
 Comparison of 1992 sales to 1991 sales:
 Higher 42 pct. 41 pct. 54 pct.
 Lower 20 20 10
 About the same 36 36 32
 Expected change in company employment -- next three months:
 Increase employment 22 pct. 22 pct. 32 pct.
 Decrease employment 4 4 7
 Keep about the same 72 72 61
 Intention to expand -- next six months:
 Yes 29 pct. 29 pct. 40 pct.
 No 64 64 54
 Type of expansion planned -- percentages based on companies planning
 to expand (total exceeds 100 percent due to multiple responses):
 Expand into new markets 32 pct. 32 pct. 34 pct.
 Real estate expansion 24 24 40
 Introduce a new
 product/service 22 22 21
 Purchase/modernize equipment 20 20 12
 Increase staff 17 17 14
 Increase capacity 9 9 7
 Acquire another company 2 2 4
 (A) "Don't Know" responses not included.
 /delval/
 -0- 1/25/93
 /CONTACT: Bill Madway, president of Madway Business Research, 215-648-3865/


CO: Madway Business Research, Inc.; Research Corporation of America ST: Pennsylvania IN: SU: ECO

CC -- PH005 -- 8298 01/25/93 09:13 EST
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