IPA SBRB Poll: Businesses Predict Gains in 2nd Half of 2004 (8/6/04) IPA Poll Shows Small Businesses Post First Half 2004 Progress, Projects Greater Gains Through Year End; Owners Optimism Offset By Capital Spending Controls

Opinions Divided On Interest Rate Increase Impact, According to International Profit Associates Small Business Research Board Report

BUFFALO GROVE, IL (August 5, 2004)--The majority of small businesses (69%) met or exceeded their expectations during the first half of 2004 and even a greater number (88%) are forecasting that they will meet or exceed their projections for the second half of the year, according to the International Profit Associates Small Business Research Board (IPA SBRB) report released today.

The IPA SBRB report further indicates that while owners and managers of small businesses are optimistic about prospects for the remainder of 2004, most are keeping tight control on capital spending. The small businesses responding to the national "IPA SBRB First Half 2004 Business Assessment Study" found that 53% will maintain their current level of capital spending through year end, while 15% will decrease spending from original budgets. About one-third (31%) intend to increase capital spending.

"It is interesting to note that many businesses expect to improve upon their forecasts without adding to their capital commitments," said Gregg Steinberg, President of International Profit Associates, the leading provider of management consulting services to small businesses in the U. S.

"While there are many business owners and managers who will support their projections by boosting capital expenses, there are many that believe their business will improve based upon the natural progression of the economy or they have excess capability already built-in to meet future demands," Steinberg added.

The IPA SBRB poll showed that 37% of the small businesses participating in the study met first half 2004 expectations while 32% exceeded their expectations. For the second half of the year, 37% predicted they will meet their expectations, 29% will show improvement of up to 10% and another 22% will improve their businesses by more than 10%.

Study participants were divided on the impact of slowly escalating loan interest rates through year-end. The IPA SBRB poll indicated that 55% of those responding said increasing interest rates by .25% up to 1% will not have an impact. However, 31% of the poll participants said rising rates will have a negative impact while 10% said that rising rates will help their businesses.

The International Profit Associates Small Business Research Board was created to determine the opinions of small business owners and managers on a wide variety of topics related to their own business as well as national and international issues that may impact their operations. This is the first poll of a continuing series of studies on economic issues that affect small businesses.

Participants in the poll provide feedback on significant issues and allow for real-time insight into the state of small businesses nationwide. The universe of participants is developed from among the more than 100,000 small businesses that have been served by International Profit Associates and its affiliates since its inception in 1991. Other small businesses will be added to the IPA Small Business Research Board. The first IPA SBRB study was a voluntary survey conducted via phone, email and fax. The poll was structured and supervised through an independent resource.

Those participating in the IPA SBRB program are invited to become members of the IPA Small Business Research Board. A website is currently under construction at www.ipasbrb.com.

International Profit Associates, Inc. (IPA) is the largest privately-held provider of management consulting services to small and medium sized businesses in North America. IPA and its more than 1,700 professionals offer a wide range of proven and innovative methodologies to help businesses grow and prosper regardless of the economic cycle. IPA either provides directly or through its affiliated companies a comprehensive array of business advisory services, tax and estate planning services or merger, acquisition and other financial advisory services in the United States and Canada. More information about IPA can be found at www.ipa-iba.com.

Survey Results in Graphical Form