This Industry Outlook is a portion of the 2018 Arizona CFO Spotlight Survey Report
The 2018 Arizona CFO Spotlight Survey attracted respondents from a number of industries in Phoenix and Tucson. We will highlight the financial & professional services segment here in terms of growth, risk factors, strengths and trends.
For the second year, financial and professional CFOs contributed to the Survey. Firms and agencies are mid-sized with regard to revenue, with more Survey respondents based in Tucson than in Phoenix. Leaders consistently note a steady economy for their city and the state over the past two years. Almost all expect revenue growth for 2018, with 70% expecting a slight increase compared to 43% of leaders in 2017. None of the leaders expect a decrease in revenue compared to 14% in 2017, which may finally indicate improvement from flat growth trends. As with other industries, financial and professional companies are looking for skilled talent, followed by a favorable tax climate and regulatory cost reductions. Competition is still one of their biggest challenges, but half of leaders expect to raise their prices in 2018 — feeling far less pricing pressure. Rate increases signal a major shift from pricing responses a year ago in the Survey.
About half of CFOs say they are absorbing the costs of health care insurance increases while the other half are moving to higher deductible plan arrangements with employees sharing a greater percentage of the costs. They are consistently shopping providers annually.
Sales and marketing remain a big focus for 2018, similar to last year. Over the past two years, it also seems that CFOs are "getting their house in order" with improved controls, processes, technologies and forecasting methods. Communication and getting all staff moving in the right direction are much bigger concerns for Arizona firms than succession or transition of leadership, which indicates that transition plans may be more solidified compared to a few years ago. Cybersecurity also seems to be under control, according to respondents. To retain staff, flexible schedules are embraced by almost 80 percent of leaders in the Survey, with 44% offering work-at-home options.
"Drones have helped our survey group."
Average Number of Employees
Revenue in 2018
- 20% Will increase significantly 20%
- 70% Will increase slightly 70%
Top Areas of Focus
- Marketing and sales
- Processes and procedures
- Competitive strategies
- Cybersecurity training
40% somewhat optimistic
Access to Cash?
small concern with credit access
78% very little impact
no concerns now
Resistance to Change?