Private Company Sentiment Index™ Falls for First Time in 18 Months
HORSHAM, PA, September 5, 2018 —Kreischer Miller, a leading independent accounting, tax, and business advisory firm serving the Greater Philadelphia and Lehigh Valley areas, today announced the results from its most recent Kreischer Miller Private Company Pulse Survey™, conducted via the firm’s Center for Private Company Excellence.
The survey found that while privately-held and family-owned companies still feel generally optimistic about their business prospects, some caution may be starting to creep in. Participants were asked to describe the current outlook for their businesses on a scale of one to 10, which formed the basis for the survey’s Private Company Sentiment Index™. The Index currently stands at 7.35, which marks the first time the index has dropped in the last 18 months. The Index stood at 7.79 in January 2018, 7.22 in July 2017, 7.06 in January 2017, and 6.28 in July 2016.
The survey also found a decline in the respondents’ level of optimism about the U.S. economy’s performance. Just over 69 percent of respondents said they are optimistic about the economy’s performance over the next 12 months, compared to 92 percent six months ago.
The government’s recent actions on trade policy and tariffs have dominated news headlines in recent months, so we asked participants how they felt these policies will impact their businesses. Nearly half (48.4%) said they will have some level of negative impact. Only 9.9 percent felt they would have a positive impact. However, a significant percentage (41.8%) said either their businesses would not be impacted, or that it was too soon to tell how tariffs and trade policies will affect them.
The Index may also have been affected by respondents’ continued challenge of finding qualified employees. When asked to cite their top business challenge, 41.8 percent of respondents indicated that access to talent was their largest issue. While the percentage of respondents who cited this as their top challenge declined slightly from the January survey (45.2%), it was still significantly higher than the next challenge cited (declining demand, 11.0%).
“From the results of this survey, which was conducted in July, it seems clear that private companies are still feeling fairly optimistic about their business prospects and the economy as a whole,” said Mario O. Vicari, Director and Center for Private Company Excellence specialist. “However, there is a level of caution creeping in. It will be interesting to see how these companies feel when we survey them again in January 2019. Was this a short-term blip, or perhaps the beginning of a longer-term trend?"
The Kreischer Miller Private Company Pulse survey was conducted online in July 2018. Survey questionnaires were distributed electronically to private company executives in the Greater Philadelphia and Lehigh Valley regions. There were 91 total participants representing privately-held companies of various sizes and in an array of industries. When asked their role in their business, 47.2 percent indicated they are an owner, 38.2 percent indicated they are a CFO/COO/Vice President, 11.2 percent are the President or equivalent, and 3.4 percent responded with other. See page 10 of the report for a more detailed breakdown of participant demographics.
Download a copy of the full survey results here.
About Kreischer Miller’s Center for Private Company Excellence
Established in 2012, Kreischer Miller’s Center for Private Company Excellence is a community – live and virtual – created exclusively for privately-held companies. The first of its kind, the Center for Private Company Excellence provides content, resources, tools, and information geared specifically toward the unique needs and issues of private companies, across the lifecycle of their organizations. It is also a forum for business owners and executives to interact and network with peers as they address the challenges they face in improving their businesses. Learn more.
About Kreischer Miller
Kreischer Miller is a leading independent accounting, tax, and advisory firm, serving the Greater Philadelphia and Lehigh Valley areas. Founded in 1975, the firm is built to respond to the unique needs of growth-oriented private companies, helping them smoothly transition through growth phases, business cycles, and ownership changes. Kreischer Miller offers a wide range of services, including Audit & Accounting, Tax Strategies, Business Advisory, Human Capital Resources, and Technology Solutions across an array of industries, including manufacturing, distribution, construction, real estate, not-for-profits, media, government contracting, professional services, family-owned businesses, and investment firms. The firm provides insight and creative services to organizations that need to be able to quickly adapt and respond to changing market opportunities and challenges. To learn more, call us at 215.441.4600 or contact us.