New Data Reveal Small Businesses Could be at Greater Risk of Financial Pitfalls Headed into the Holidays and New Year

Second part of H&R Block’s “Small Business Recovery Series” study reveals nearly half of small business owners run their businesses on intuition rather than data despite continued loss of revenue

KANSAS CITY, Mo., Oct. 27, 2020 (GLOBE NEWSWIRE) -- H&R Block (NYSE: HRB) has released new data from its “Small Business Recovery Series” study, revealing many small business owners could be operating with greater financial risks that could be avoided as they head into the busiest and most lucrative time of year, the holiday season.

“The most recent findings from our Small Business Recovery Series reinforce a trend we’re seeing where small business owners are focused on regaining lost revenue by offering new products and services, along with growing their e-commerce presence. While this rapid adaptability is key to surviving the pandemic, running on gut instinct instead of data and without professional counsel could put them at increased risk for unanticipated financial and tax implications,” said Jeff Jones, president and CEO of H&R Block.

The second installment of H&R Block’s study exposes that many small businesses are:

Running on gut instinct versus facts: Nearly half of small business owners (47%) say they “almost exclusively” or “mostly” run their businesses on intuition rather than data.

Not seeking professional advice despite continuing to see a loss in revenue: Though nearly three quarters of small business owners (74%) continue to see a negative impact on their business, including a decrease in revenue since the pandemic, most small business owners (90%) have not sought financial and tax advice from a CPA or tax professional related to COVID-19 impacts.

Rapidly evolving their businesses: More than half of small business owners (52%) are transforming their businesses for digital commerce in anticipation of the earliest and largest online holiday shopping season yet, with 41% creating new services and 40% creating new products. ¹

Disproportionately affected, with minority and female business owners reporting greater challenges: 35% of minority owners reported trouble establishing a strong digital presence as a major barrier to e-commerce, while 25% of white small business owners cited this challenge. For women business owners, 34% cited trouble establishing a strong digital presence compared to 27% of male small business owners.