The recovering economy has likely been a boon for millions of American small businesses, and that in turn has led to many owners feeling better about their prospects for success going forward. Now, a new survey suggests that such an outlook hasn’t been this bright since the recession.
In the most recent poll of entrepreneurs nationwide, optimism increased to a plus-45 rating in the early part of January, the highest level seen since the third quarter of 2008, according to the latest Wells Fargo/Gallup Small Business Index. And while that number is up considerably from the plus-24 observed in October 2013, it’s also well below the levels seen prior to the onset of the financial downturn.
“There are many reasons for small business owners to view 2014 as a promising year,” said Lisa Stevens, Wells Fargo lead executive for Small Business and Pacific Midwest Regional Banking president. “There’s less uncertainty in the economy than there has been for quite some time. Congress approved a federal budget deal at the end of last year. The stock market performed well in 2013, and capital spending has picked up. With each piece of good news, business owners gain a little more confidence to grow and expand. We know that small business owners still face many challenges, yet hope this momentum continues as the economy improves further.”
What did small business owners like?
The various factors cited for small business success during this time included far more cash flow, hiring, revenues, and access to financing, the report said. For instance, 52 percent of owners said they had more cash flow overall, compared with 46 percent three months earlier, and 57 percent expect that to continue throughout the next 12 months. Likewise, 48 percent think revenues will increase during that time, compared with 44 percent who felt the same way in the previous quarter. Meanwhile, just 23 percent of companies had difficulty in obtaining necessary credit during this time, down from 27 percent. That could lead to more hiring, as 22 percent plan to bring on more workers in the coming year, up appreciably from just 16 percent in October.
Owners who want to do even more to secure their bottom lines might want to consider the ways in which shopping around for small business insurance might help. Lower-cost liability insurance, for instance, could reduce expenses by thousands of dollars per year.