By Carole Wood
There has been a recent injection of hope into America’s small business economy as the Index of Small Business Optimism gained 1.8 points in November, rising for the third consecutive month and hitting the highest level since February. In addition, the employment picture brightened as 55,000 new jobs were created in small businesses last month, ending five months of decline.
The US small business market is formed of c. 27 million companies with a yearly revenue of up to $2 million. According to research, the drive behind setting up a business for 55% of US small business owners is a desire to be their own boss, and despite tough economic times 26% of established businesses still believe that running their own company is a better option than working for someone else. The most encouraging statistic reveals that although 57% of small businesses reported little or no revenue growth across 2011, 47% remain optimistic about their prospects in the upcoming year.
And small business owners have a lot to be positive about going into 2012. Despite the six challenges identified by The Guardian Life Small Business Research Institute that businesses are likely to face, there are simple steps owners can take to successfully navigate these challenging conditions and achieve growth:
1. Stay strong during continued economic volatility by implementing dynamic & flexible plans
2. Overcome tight access to capital by investing borrowed funds primarily into strengthening workforce skills, upgrading equipment and marketing
3. Fight the risk of insolvency by improving productivity; surround yourselves with the right team of people and focus on working efficiently together to achieve growth
4. Resist larger companies poaching small businesses’ customers by differentiating: offer customized local products and services
5. Do not be disheartened by politicians forecasting doom and gloom for small businesses; instead keep morale high by maintaining a positive, confident attitude
6. Capitalize on the likely trend that 2012 will bring lots of deal-making; negotiate with vendors and larger customers by offering to make commitments in return for price reductions or better payment terms
Proof that the US is attracting new small businesses can be found in the case of Peter Bauer, an entrepreneur who has recently moved his start-up from London to Boston in order to focus on growth. He runs Mimecast, a tech firm with 270 staff and $33 million turnover, and firmly believes America holds the key to vast growth opportunities in his sector. He has set about building a strong presence in the market by recruiting the best local experts and replicating the success established in the UK.
John Davis, Managing Director of Business Centric Services Group (a small business also located in both the US and UK), states: “there is no doubt that 2011 has been a challenging year for small businesses in America, yet there is evidence that growth is returning and this signifies an important turning point going into 2012. Business owners should welcome the new year with an optimistic outlook”.
Author: Carole Wood, Marketing Manager, Business Centric Services Group
About Business Centric Services Group: BCSG create and distribute value adding products and services to over 135,000 small businesses through financial institutions. BCSG products provide real, tangible solutions for small businesses to survive and succeed while simultaneously providing financial institutions with the opportunities to differentiate their proposition, enhance customer loyalty and grow wallet share. For more information please visit: www.bcsg.com