THE top short-term and long-term concern facing small businesses is the cost of doing business in the CNMI, according to a survey report prepared by the Governor’s Council of Economic Advisers in collaboration with the CNMI Small Business Development Center Network and the Saipan Chamber of Commerce.
The survey also indicated that 54% of small businesses in the CNMI had an annual revenue of less than $50,000 in 2021.
Of the respondents, 56% said their operation costs amount to at least $50,000, including rent, salaries, and other overhead costs.
Fifty-one percent said it is difficult to start or run a business in the CNMI while 16% said it was “very difficult.”
The 23-question survey was conducted from June 28 to August 4. There were 210 survey respondents, of which 135 were U.S. citizen-owned small businesses, 67 non-U.S. citizens, and seven green-card holders.
Of those surveyed, a majority were either in the retail, restaurant, bar, or professional service industry.
Thirty-six percent of the respondents have had their business running for over a decade, while 28% have only been around for one to three years, 20% for less than a year, and 16% for four to nine years.
A majority of respondents rent their workspace, while others either operate their business from home, rent multiple spaces, own a space, rent a space in a co-working or shared space, or own multiple spaces.
Overall, of the 210 survey respondents, roughly 58% did not receive any financial assistance to start their businesses.
The largest single reason given for challenges in obtaining financing was the limited knowledge of financing options available.
Other respondents, however, said that this challenge was due to lack of affordable rates or favorable terms, insufficient collateral, or their business or personal credit score.
Other major short-term concerns include finding suitable workspace and expanding to new markets, while other major long-term concerns include recruiting or retaining appropriate workforce and dealing with income volatility.
More than 67% of respondents found that it is difficult or very difficult to find business support and advice in the CNMI.
Twenty-six percent of the respondents described their small business as established but stressed, while 25% identified themselves as being in the start-up stage, 21% as established and stable, 15% as profitable and growing, 8% as pre-profit, and 4% as established but considering closure or sale.
To view the full report, visit https://www.cnmieconomy.com/_files/ugd/8bb7d7_771b229fe3b0481cb74513ee58b2b99c.pdf
