Intuit QuickBooks Small Business Survey: Top investment areas to catapult business growth

Business owners are expected to spend an average of $45,000 to $142,000 on digital tools over the next 12 months, according to the Intuit QuickBooks Small Business Survey. This investment is intended to help solve some of the biggest challenges facing small businesses this year and drive new business growth. 

Nearly all surveyed business owners (95%) say they have business growth goals for 2023 — but they face some big hurdles on the road to success. Nearly 40% say managing finances and accounting is a top challenge — this comes as no surprise, many new business owners admit they’re not totally confident when it comes to the financial aspects of running a business. Another 35% say they lack time to complete important tasks, and 33% say dealing with customer-related issues is a major challenge.

To address these challenges, business owners are turning to digital solutions that streamline and automate business operations and give better visibility into financial performance. More than 4 in 5 business owners say they plan to invest in digital tools this year. Of them, 73% are prioritizing business and financial technology, including artificial intelligence (AI) and e-commerce solutions. Let’s take a closer look. 

Businesses are unlocking the value of AI

AI is top of mind for, well, everyone. Generative AI tools like ChatGPT have made AI more accessible than ever. Users have quickly discovered that AI is capable of handling a slew of tasks, from producing content to composing sheet music to writing simple computer programs. More than that, when used correctly, it’s capable of automating and streamlining business processes. For the 35% of small business owners who identified a lack of time as a top challenge, AI can be a helpful solution. 

Almost all small business owners say they are eager to automate operational tasks — and they’re turning to AI for help. Surveyed business owners said they plan to adopt AI to help with marketing and content creation, analyzing customer trends and behaviors, and customer service support.

Another 28% plan to adopt AI tools for managing cash flow and 24% say they want to use AI to automate low-level tasks. If they had their way, business owners say they would automate expense management, invoicing, completing payroll, running financial health reports, and conducting customer communications. The time saved by automating these tasks would allow these business owners to focus on key growth areas. Nearly half (43%) say they would use the extra time to develop better customer relationships, and 36% said they would focus on developing products and services.

QuickBooks Online Advanced is a flexible solution with functional add-ons designed to meet the unique needs of your business as it scales, including workflow automation, robust reporting tools, and deep integrations to third-party applications all with a new level of performance, scalability, and customization.

For more than a decade, Intuit has been driving AI innovation to help its customers solve their most important financial problems and drive durable growth for small businesses. Intuit has been building AI capabilities — including machine learning, knowledge engineering, natural language processing and understanding, and generative AI — directly into its products to provide customers with personalized experiences with accuracy and speed, at scale. For example, QuickBooks Online uses AI to automate repetitive accounting tasks, predict cash flow, and make it easier to get paid.  

Generative AI is transforming the way humans interact with computers, and Intuit is uniquely positioned to be the financial technology leader in bringing this technology to small businesses quickly. Intuit recently expanded its platform architecture with a proprietary Generative AI operating system (GenOS) to empower its technologists to design, build and deploy breakthrough generative AI experiences with unparalleled speed.

Expanding e-commerce is a top priority

The COVID-19 pandemic accelerated the value of e-commerce in unprecedented ways… but that’s old news. Today’s consumers continue to prefer a virtual shopping experience, and small businesses are moving rapidly to accommodate the growing frequency and number of customers searching and shopping online. Nearly 9 in 10 business owners (89%) say they are selling or plan to sell on at least one e-commerce platform this year. Half of those businesses plan to sell more online over the next 12 months, and 36% plan to invest in additional e-commerce solutions.

In 2022, more than half of businesses that experienced growth say they invested in e-commerce technology (54%), demonstrating both the importance and success of this strategy. In fact, e-commerce technologies were the most common type of investment small businesses made to drive growth last year — 46% of small business owners say they invested here. 

Seamlessly connect all your online sales channels in QuickBooks for e-commerce to see your income and expenses in one place.  

Gaining and retaining customers are top concerns

A business can’t grow without customers, and small businesses know it. Half of small business owners agree that customer retention is among the most important business metrics for judging the success of a business. However, for many small businesses, acquiring new customers is a far more common concern. While 29% of surveyed business owners say they’re concerned about customer retention, 71% are more concerned with customer acquisition. In fact, 20% of small businesses say acquiring customers is the biggest obstacle inhibiting growth, second only to the rising cost of inflation. 

Fortunately, both customer acquisition and retention can be improved with the right technology. Nearly a third (30%) say customer engagement and communications, like email marketing and customer support, is the top business operation they wish they could automate. 

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The realities of business growth

Almost every respondent said their business has growth goals for 2023 — but growth means different things to different businesses. For some, growth means increasing online and social media sales through e-commerce technology, for others growth means expanding their team or their audience. That said, the majority of small business owners (72%) share a common growth goal of increasing revenue this year. But a nearly equal amount (71%) say this is a difficult goal to achieve in today’s economy.

Investing in business and financial technology is one way to meet these growth goals. More than 7 in 10 small business owners say they invested in technology last year, spending over $35,000 on digital tools on average. But it paid off. Almost all of these business owners (95%) say those investments were made to drive business growth. 

Small businesses are on track to invest even more in business and financial technology for growth in 2023 — up to $141,000 for medium-sized businesses with 100-200 employees.

Small businesses report positive ROI

Adopting new technology is always accompanied by the risk of it not living up to expectations. There’s a chance of the technology being too complex or adding additional work to a business owner's already full plate. With that in mind, not every small business has a success story: About 1 in 7 business owners who invested in technology last year say they scrapped it entirely. Another 19% admit they’re not using the technology to its full potential. And 25% feel they may have overspent on technology solutions. 

But, despite these disappointments, the return on investment (ROI) is positive. Business owners who invested in technology last year report increased operational efficiency, increased sales, better ability to manage financial performance, and stronger employee management capabilities.

Convenience and efficiency go a long way when choosing a technology solution — and for that many small businesses turn to apps. Nearly 4 in 5 small businesses (79%) use applications to run their business, using 11 applications on average. The majority (89%) say their digital tools and applications have a positive impact on how they run and manage their business. Only 11% feel these tools and apps have created more complexity. 

The lesson here? Small businesses should think critically about the financial technology tools and applications they choose to use and invest in to avoid creating complexity or overspending on tools that don’t work for their team. The right tools and technologies can save time, increase efficiency, and accelerate the growth of your small business.  

Methodology

The online survey of 1,000 U.S. business owners at companies of 0-200 employees was conducted by Wakefield Research (www.wakefieldresearch.com) between May 1st and May 10th, 2023 with invitations sent via email. Results of any sample are subject to sampling variation. The magnitude of the variation is measurable and is affected by the number of interviews and the level of the percentages expressing the results.