Small Businesses More Optimistic About 2010
Eighty-seven percent of small business owners say their business will perform at least the same or better in 2010 compared with 2009, and 57 percent are cautiously optimistic that the new year will bring an end to the pain of the recession, according to a new survey.
A remarkable 92 percent of small business owners are considering proactive strategies to prepare for an economic upswing, with 36 percent expecting to see their business grow in 2010. TD Bank conducted the survey to gauge how the recession and other issues are affecting small businesses.
"What's encouraging is that the majority of small businesses are not only anticipating but gearing up for an economic recovery, said Fred Graziano, head of retail and small business banking for TD Bank. This indicates that small businesses will generally be well positioned to both ride out the storm and seize new opportunities for growth in 2010.
Two-thirds of small business owners say the recession had some level of negative effect on their business, with 23 percent rating the impact as very negative.
The sting of the recession is evident in how small business owners rate their company's performance over the past year. In 2009, 46 percent of small businesses fared as they expected, giving their business a C. Thirteen percent gave their business a B rating and only 5 percent gave themselves an A. Twenty-six percent say they did not have the year they planned on in 2009, giving their business a D, and an unfortunate 10 percent rated their company with an F, saying their business landed in serious trouble.
The economy wasn't the only concern for small business owners in 2009. Aside from the recession, 38 percent said their biggest hurdle was retaining and growing their customer base, while managing cash flow was the toughest challenge for 34 percent of respondents.
Keeping health care and insurance costs in-line (15 percent) and staffing issues (8 percent) were also sources of stress. Still, if given the chance, 35 percent of small businesses say they would have done nothing differently in 2009, while 24 percent would have done more sales and marketing.
Interestingly, nearly a quarter (24 percent) say the recession had no influence over their business' performance in 2009, and 10 percent say they grew their business despite the recession. And for the slim 5 percent who report that 2009 was their best year ever, it appears that streamlining costs (29 percent), innovating with the right products and services at the right time (24 percent), and shrewd forecasting (22 percent) were the keys to their success last year.