According to an article on BusinessWeek, surveys show that small business owners sense the economy has bottom out and is starting to change direction.
The surveys
The National Federation of Independent Business’ monthly optimism index, which taken into account how business owners view the economic situation, including what their plans are for hiring and investing. The index shows a one point decline in June (to 87.9), but has gained 6.9 points since March.
The Discover Small Business Watch’s survey also shows rising confidence in its optimism index – rose 1.2 points to 82.1. Additionally, while about 50% of the surveyed small business owners still sense the economy is declining, 30% sparked optimism, saying that it’s recovering – Up 4% from last month.
Despite the good indicators, small business owners are being cautious in responding to those positivism. The Discover Small Business Watch found that 49% of small business owners surveyed planned to cut business development spending over the next six months.
The draw backs are amplified by the fact found by Greenwich Associate, a financial services research and consulting firm, that 70% of the surveyed small business owners said that access to credit is more limited, compared to last year.
What the surveys indicates
Small business owners are great at sensing the changes in wind direction – They are the one who navigate their businesses, after all. Today, they sense that things are nearing to the tipping point.
They are getting ready for the big upturn wave, indeed. However, only a few are ready their surfing board to ride the wave of dynamic economic recovery.
Moreover, although things look promising, as some small business owners are experiencing a jump in their sales, job cuts landslide will still continue – This, in effect, will slow down recovery and justify that being cautious in the midst of optimism is probably the best way entrepreneurs plan for their businesses’ future.
What you got to do to take part of the recovery
I have written about the butterfly effect in businesses before – When the small business leaders show signs, we should heed them and ready ourselves to take part in the butterfly effect (or ripple effect, if you prefer.)
Being cautious is probably the best thing you and I should do – plan for rapid growth in the near future, ready your business infrastructure, but keep your eyes closely on your business’ budget and spend every penny carefully – You don’t want to get caught in the middle of optimism with only your underwear on (just kidding – but you get my point…)
Being happy-go-lucky is the least thing you want to do for your business – Plan your recovery well, so things unknown that can drain your cash can be avoided at all cost.
Ivan Widjaya
Economic recovery
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