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Posts Tagged ‘small business outlook’


Will Small Business Optimism Ever Recover?

September 6th, 2011 ::

By Karen Axelton

American Express OPEN recently celebrated the 10th anniversary of its semi-annual Small Business Monitor surveys by releasing a retrospective report that analyzed the results of the surveys over the past 10 years. The results have some sobering data for small businesses.

The study found that before the “Great Recession” of 2008, small business owners nationwide were typically optimistic, no matter what their gender, industry or size of their business.  Since the recession, however, entrepreneurs have not yet recovered their “sunny disposition,” according to the American Express OPEN® Small Business Monitor Optimism Review.

The study looked at small business owner responses to two positive and two negative statements about the economy and subtracted the negative responses from the positive to come up with a “net optimism score.” In fall 2002, for example, 64% of entrepreneurs had a positive outlook about their business’s future, while 29% had a negative view, for a net optimism score of +35. In the spring of 2011, 49% had a positive view, while 48% held a negative view, for a net optimism score of just +1.

Here are some more findings:

Between late 2002 and late 2007, optimism was high among virtually all small business owners, peaking in mid-2005. However, between late 2007 and early 2008, optimism took a nosedive and since then, hasn’t recovered for any business owner, regardless of geographic region, company size, industry or sex of the owner.

Business owners in the South and West were the most optimistic in the country before 2008. But in the past four years, businesses have become more volatile in their outlook depending on what part of the country they are in. In the most recent Small Business Monitor survey (spring 2011), net optimism scores by region are:

  • Northeast (+15)
  • West (+4)
  • South (+3)
  • North Central (-19)

Before 2008, there was little difference in optimism by firm size. Since then, larger small companies have shown more volatility in their outlook, with the biggest decline in optimism among those with 20 to 49 employees and those with $500,000 to $999,999 in annual sales.

Who’s the “canary in the coal mine” for small business optimism? Small retailers are the bellwether industry group. When business optimism plummets, their pessimism leads the way.

How does this report jibe with your outlook for your small business?

Image by Flickr user loneymops (Creative Commons)

 

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Posted in Small Business, small business | No Comments »

Global Economic Outlook: Small Business Owners Are Optimistic

July 5th, 2011 ::

By Maria Valdez Haubrich

With the 4th of July just behind us, what are American entrepreneurs—and those around the world—thinking about their prospects for the coming months? The latest Global Entrepreneur Indicator survey has some good news.

The Global Entrepreneur Indicator is a quarterly survey of the members of the Entrepreneurs’ Organization, a nonprofit for business owners who have more than $1 million (US) in annual revenue. The June 2011 survey of more than 7,500 entrepreneurs in 38 countries found the global economic outlook is getting more positive.

In the most recent survey (June 2011), 62 percent experienced an increase in their net profits — a 25 percent increase over the previous year, when just 37 percent saw an increase.

As for job creation, as of June 2011 more than half (57 percent) had added jobs since they were last surveyed (in November 2010). That was also an increase from the 42 percent who had added jobs as of June 2010.

The news got even better when entrepreneurs surveyed were asked their predictions for the next six months. More than three-quarters (78 percent) expected their net profits to improve in that time frame; 68 percent expect to add jobs; and 61 percent expect both the global and local economy to improve.

Keep in mind, however, that this is a global survey—and the picture isn’t quite as rosy for U.S. entrepreneurs as for those in some other nations. In the U.S., 59 percent of entrepreneurs expected the local and global economy to improve in the next six months—the same percentage as in Europe and the Middle East. In Latin America/the Caribbean, however, 74 percent expected improvement, and in Canada, an astounding 91 percent did.

The least optimistic nation? Asia, where 56 percent expected to see the economy improve within six months.

Image by Flickr user Matt P. (Creative Commons)

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Posted in Entrepreneurs, Entrepreneurship, Small Business, small business | No Comments »

Despite Worries, Small Business Owners Are Optimistic, Citibank Survey Shows

April 14th, 2011 ::

By Maria Valdez Haubrich

Small business owners are facing a lot of challenges these days, but in spite of it all, they’re still optimistic, according to the results of a recent Citibank poll.

What are the biggest challenges on small business owners’ minds in 2011? Rising raw material prices (25 percent) and the increasing cost of health care (23 percent). What they’re not worried about is the impact of government policies: 40 percent expect policies to remain the same and 18 percent expect them to be more favorable in 2011.

What would be most helpful to their business this year? Respondents say reducing taxes (30 percent), lowering health-care costs (17 percent), and increasing credit availability (17 percent) would make the biggest difference.

The emphasis on finances makes sense, considering that the majority of respondents expect the costs of running their business to increase this year. According to the survey:

  • 83 percent expect utility costs to rise
  • 80 percent expect the cost of healthcare to increase
  • 80 percent expect the cost or raw materials to rise
  • 68 percent expect taxes to increase
  • 60 percent expect the cost of borrowing to increase

As a result of rising costs, 45 percent plan to raise their prices; however, 55 percent do not.

Small business owners in the survey have big plans for improving their businesses in 2011. To grow their businesses, they will work longer hours (59 percent), increase marketing (52 percent) or increase employee productivity (43 percent). More than half (52 percent) also plan to offer new products or services in the coming year, and 43 percent plan to expand into new markets.

Perhaps those energetic growth plans are the reason for the overall optimism of small business owners in the survey. The majority believe 2011 will be better than (44 percent) or the same (42 percent) as 2010; just 15 percent expect it to be worse. And the number of business owners who described current conditions as excellent or good rose to 33 percent in January, up from 24 percent in September and 23 percent in March 2010.

Image by Flickr user Mykl Roventine (Creative Commons)

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Posted in Entrepreneurs, Entrepreneurship, Small Business | 4 Comments »