Small Business Success Index Highlights
Small business owners say they are more efficient, innovative and have stronger teams due to recession
There is a silver lining to the continuing recession for the majority of small businesses, with two-thirds of owners surveyed in the latest Small Business Success Index (SBSI) reporting they are finding new ways to operate more efficiently. The index, based on a June 2009 telephone survey of 500 small business owners, also found that small businesses mood has brightened compared to six months ago, with 38% of small business owners expecting the economy to improve in the next 12 months, compared to the 23% who felt this way in January. In June, only 28% of small business owners expected the economy to decline in the next 12 months, compared to nearly half (48%) just six months ago.
In addition to the 66% of small business owners saying they are now more efficient, the SBSI reported that 42% of owners say the recession has caused them to strengthen internal teams and the same percentage are more innovative and say they are providing new products and services to benefit customers.
Small businesses have become more optimistic about their future:
- In June, more small businesses expect the economy to improve than decline in the next 12 months, with 38% expecting improvement compared to 28% who expect decline. When asked the same question six months ago, only 23% expected improvement and 48% expected decline
Small businesses have experienced positive effects from the economic downturn:
- 66% say the economy has led them to find new ways to operate more efficiently
- 42% believe the economy has caused their company to become a better team
- 42% have found new products and services to benefit customers
- 26% have reduced inefficient or unnecessary staff
Small businesses have also been hit with some negative effects of the recession:
- 30% of small business owners believe their access to capital is not sufficient
- 41% of small business owners have had to accept a lower standard of living
- 30% of small business owners report the recession has hurt employee morale
- 19% of small business owners say they have had to reduce valuable staff
- Some small businesses have cut employee benefits, with 15% reducing their retirement savings plans and 3% eliminating this benefit in the past 12 months
- Small business have also reported changes to health insurance benefits, with 19% increasing the benefit and 22% decreasing the benefit level in the past 12 months. Rising healthcare costs are a “major problem” for 48% of small businesses with employees
About the Small Business Success Index
Small businesses account for 98% of all businesses with payrolls, 27% of business receipts, and 36% of jobs. According to the U.S. Census Bureau, the small business sector is responsible for over 40 million jobs and a staggering $6 trillion in revenues. They are a vital source of innovation and commitment that drives the U.S. economy, and provide a path to personal independence for millions of Americans.
Given the importance of the small business sector, Network Solutions®, LLC and the University of Maryland’s Robert H. Smith School of Business partnered to track the competitive health of small businesses over time. The baseline survey for the Small Business Success Index (SBSI) was conducted in December 2008 through January 2009 by interviewing 1000 small business owners over the telephone. The second survey wave was conducted in June 2009 among 500 small business owners, and weighted to ensure a representative sample of private businesses in the U.S. with fewer than 100 employees. The survey is longitudinal in nature, tracking trends in Small Business Success over time; the completion of the second wave provides a six month trend line.
Network Solutions is the leading enabler of small business success in the highly competitive online space. By providing the tools and resources to start, grow and manage businesses online, Network Solutions leverages 30 years of pioneering experience to help companies thrive in an increasingly digital world. To ensure our customers’ success, we support them with outstanding customer service and solutions that are simple, innovative and reliable. Additional information can be found at www.about.networksolutions.com.
