Despite all the negativity we hear in the press about the sad state of the economy these days, the latest Citibank small business survey shows that the majority of small business owners believe they are poised to grow or are already in growth mode. According to the results, about 49-percent say they are “holding their own, but poised to grow when the climate is right” and 28-percent indicated they are already growing. Of course, the vast majority (90-percent) of small business owners remain concerned about the economy, including the possibility of a double-dip recession.
“It’s encouraging that small businesses feel prepared to seize the opportunity for growth when it presents itself.” says Raj Seshadri, Head of Small Business Banking at Citibank. “The underlying message here appears to be that small business owners are preparing themselves for a more sustainable growth path, and are not expecting any type of quick fix or change. What’s also interesting to note is the vast majority feel they will play a key part in our economic recovery.”
Economic Key Findings
· 94 percent said they feel they are either very (66 percent) or somewhat (28 percent) responsible for the nation’s economic recovery.
· 90 percent are concerned about the possibility of a double-dip recession.
· 79 percent are prepared if the economy were to experience another downturn.
· 78 percent plan to keep the same number of employees, while 17 percent plan to increase in the next year, and only 5 percent foresee the need to reduce.
· 30 percent plan to hire temporary or part-time workers instead of full-time employees.
As small business owners look back over the past few years,they share that the biggest challenges of owning/running their business have been:
· Taxes, insurance and/or benefit costs (65-percent),
· Declines in sales/poor economic conditions (61-percent), and
· Personal stress/being accountable for everything/everyone (60-percent).
The American Dream
But the good news is that the majority of small business owners (64-percent) say they are living the American Dream despite the challenging environment.
· 83-percent said owning a small business helps them fulfill the American Dream.
· For small business owners, living the American Dream also means being able to afford the lifestyle they want (73-percent) and being able to save and plan for the future (72-percent).
· 77-percent cited “being their own boss” as the key benefit to being a small business owner.
Looking Ahead: The Rest of 2011 and 2012 Outlook
As small business owners look to the future months and 2012, 50-percent say it will be “steady as she goes – continuing much as we are now” for the holiday season.
In an effort to improve or grow their business in 2012, small business owners plan to:
· Increase their marketing efforts (61-percent),
· Get better pricing from suppliers, vendors or landlords (58-percent),
· Introduce new products and services (56-percent), and
· Work longer hours (45-percent).
Looking forward to 2012, topping the list of most important issues for their business:
· Consumer confidence (64-percent),
· Maintaining or increasing sales (63-percent), and
· Taxes and/or government regulation (62-percent).
As small business owners plan for 2012, they are likely to increase:
· Use of their website to drive business (62-percent),
· Marketing using social networking sites (41-percent), and
· Use of email marketing (40-percent).
“The results of this current Citibank Small Business Survey are consistent with what we’re seeing and hearing from our clients, in that they are being thoughtful and prudent in their planning,” adds Seshadri. “At the same time, you can also see how innovative they are in how and where they are looking for growth opportunities, which really demonstrates the type of entrepreneurial spirit we need to help drive our economy in the right direction.”
The Citibank poll was conducted via telephone by Abt SRBI from August 4 – August 16, 2011, among a national random sample of 1,000 small business owners/operators in the United States, with revenue over $100,000 and no more than 100 employees. The margin of error is approximately +/- 3.0% percentage points at 95% confidence. Surveys are subject to other error sources as well, including sampling coverage error, recording error, and respondent error.