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Toledo Legal News - News Ohio small businesses saw biggest revenue increase in first half of 2019

 

Ohio small businesses had the greatest revenue increase of any state during the first half this year, according to a recent study.

Ohio small businesses experienced a 20.6 percent growth from January to June while U.S. small businesses grew 15.7 percent, according to the Kabbage Small Business Revenue Index.

"The Kabbage Small Business Revenue Index reflects the real-time revenue growth of truly small businesses," said David Snitkof, head of analytics & data strategy at Kabbage, in an email to The Daily Reporter. "Ohio's small businesses' revenue growth increase of 20.5 percent in the first half of 2019 is reflective of local trends stating that businesses with five or fewer employees are on the rise and driving significant business growth for the state. Our data helps quantify just how 'significant' that growth has been for Ohio businesses."

Tennessee was the second state with top small business revenue growth at 20.52 percent, followed by Pennsylvania (19.41 percent), Maryland (19.22 percent), Washington (19.08 percent), Illinois (18.7 percent), New Jersey (18.54 percent), Massachusetts (18.12 percent), Virginia (17.72 percent) and North Carolina (16.75 percent).

The Kabbage Small Business Revenue Index analyzes real-time financial transactions from small businesses.

"Instead of relying on dated research or static survey data, this is a living and breathing Index. We draw from over 2 million live data connections we maintain with more than 200,000 small businesses, and then we reweight the findings to the national makeup of businesses in the U.S.," Snitkof said.

The findings are in line with recent economic developments in Ohio, according to the index report.

It noted that the number of small businesses in the state with five or fewer employees is rising and driving an increase with the number of business establishments.

The report stated: "The number of business locations in Ohio "is back to record levels" with 284,074 business locations, topping 'the old peak of 280,775 set in 2008.' As small mom-and-pop shops, making up about half of all business locations in Ohio, the Kabbage Small Business Revenue Index reflects a positive uptick in revenue growth in relation to the increase of businesses in the state."

Ohio was the top state in the large state group, made up of states with more than 580,000 small businesses.

Ohio, Tennessee and Pennsylvania were again the top three states, followed by Colorado, Virginia, Massachusetts, North Carolina, Maryland, Georgia and Washington.

"Up until the Kabbage Small Business Revenue Index, small businesses had a lack of tools that allowed them to benchmark their growth with like-sized companies," Snitkof said. "Past research has typically adopted the government's definition that a small business is any company with as many as 500 employees. That's not small and nowhere near an honest reflection of Main Street America. The Kababge Index is unique, as 83 percent of all companies analyzed have 10 or fewer employees."

Holly Wade, director of research and policy analysis of the National Federation of Independent Businesses, said "strong optimism" continues in the small business sector in the nation.

"Last year was the most optimistic on record as measured by NFIB's Small Business Economic Trends survey. Since then, we are still at strong levels in 2019 with small business owners reporting above-average optimism. Despite a slight slowdown in 2019, likely due to the government shutdown earlier this year and escalating tariffs, overall, the small business economy is roaring ahead with no sign of a near term recession," she said.

BRANDON KLEIN, Daily Reporter Staff Writer

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