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IPA SBRB Study: Small Business Predictions for Greater Revenue Drives Increase in IPA Small Business Confidence Index


Owners also indicate they intend to improve profitability through expense reductions, investments in productivity improvement and facility upgrades

Buffalo Grove, IL, December 29, 2006 --(PR.com)-- Small business owners and managers, armed with results from the first three quarters of 2006 and thoughts about the coming year, are showing heightened confidence for their business prospects during the next 12 months, according to the latest International Profit Associates Small Business Research Board (IPA SBRB) study released here today.

Furthermore, the most recent nationwide study clearly indicates that small business owners are optimistic for attaining higher revenue levels, despite remaining bearish about the overall strength of the economy.

The IPA Small Business Confidence Index (IPA SBCI), which measures expectations regarding the general economy, revenue growth and hiring looking forward 12 months, rose to 42.7 as a result of the most recently completed survey or an increase of 3.4 points from the 39.3 index reported at the outset of the third quarter. By comparison, the IPA SBCI began 2006 with an index of 52 points and followed with a drop to 47.3 at the start of the second quarter. The IPA SBCI was 55 at the start of 2005.

While 39% of the business owners believe the general economy will improve during the next 12 months (a decrease of 3 points from the 42% who had a favorable outlook in the previous period), nearly 60% of the respondents said they believe their revenues will increase during the same period. The poll indicated that 38.5% of the respondents said that they expect revenue increases of 10% or greater and 20% said they believe their revenues will be up to 10% better during the coming 12 months. This is a sharp contrast to the previous IPA SBRB report issued in August which indicated that 46% of the respondents representing a cross section of small businesses said they were expecting improved revenues -- 31% stating that revenues would be 10% or better and 15% stating that revenues would b up to 10% better.

Thoughts about hiring were nearly identical to the previous input with 30% of the small business owners intending to increase hiring and 9% intending to decrease their workforces.

“What is truly clear is the intention of the small business owners to be realistically concerned, practically involved and carefully optimistic about the future of their businesses,” said Gregg Steinberg, President of International Profit Associates, the largest privately-held provider of management consulting and professional services to small and medium-size businesses in North America.

“Small business owners know the economy is tough, and may become even more of an obstacle, yet they are predicting higher revenues and planning for greater profitability. The results of the IPA SBRB poll indicates that business owners are going to work hard on cost reduction while investing in methods to improve productivity. Furthermore, the overwhelming majority are making plans to improve their current facilities rather than add more real estate commitments,” Steinberg said.

Increased revenue (according to 22% of the respondents), reduced expenses (18%), improved productivity (14%) and upgraded facilities (9%) are the leading small business goals for 2007. The addition of facilities at 0.4% was last on the list of goals.

The International Profit Associates Small Business Research Board ascertains and reports the opinions of small business owners and managers on a wide variety of topics related to their own businesses as well as national and international issues that may impact their operations.

Participants in the poll provide feedback on significant issues and allow for real-time insight into the state of small businesses nationwide. The universe of participants is developed from among small businesses across the United States. More than 550 small business owners and senior managers participated in this IPA SBRB poll. The IPA SBRB study is a voluntary survey conducted via phone and email. The poll was structured and supervised through an independent resource.

The latest information about the IPA Small Business Research Board can be found at www.ipasbrb.com.

International Profit Associates, Inc. (IPA) is the largest privately-held provider of management consulting services to small and medium-size businesses in North America. IPA and its more than 1,800 professionals offer a wide range of proven and innovative methodologies to help businesses grow and prosper regardless of the economic cycle. IPA either provides directly or through its affiliated companies a comprehensive array of business advisory services, tax and estate planning services or merger, acquisition and other financial advisory services in the United States and Canada. More information about IPA can be found at www.ipa-iba.com.

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Contact Information
IPA SBRB
R. D. Minkus
(847) 441-4294
Contact
www.ipasbrb.com

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