Small Business Owners Appear Cautiously Optimistic Going Into 2009

For much of 2008, small business owners have been pessimistic about the economy, much like their consumer counterparts.  The National Federation of Independent Business, for instance, shows little optimism in its most recent survey, with small business owners reporting little desire to expand their business, hire new workers, or invest in new capital equipment.  The NFIB survey also states that “poor sales” is the top concern, which is not surprising given the recession and its impacts.

Going into 2009, there is still reason for concern.  Yet, many of the respondents to my most recent Linked In question remain cautiously optimistic.  Many of the responses were similar to this one: “I am optimistic, but I am trying to serve a narrow niche and keep very low overhead.”  Indeed, several small business owners cited the fact that costs were coming down as a reason for optimism.  A serial entrepreneur, for instance, said, “Having a low cost base means cost effectiveness and offering my products to clients at a lower cost than my larger sized competitors. This means that distributors and retailers earn more margin from my products that others, thus they would ideally do more business with me to keep their bottom line in check.”  Other factors mentioned as reasons for optimism include: nimbleness of smaller firms to take advantage of opportunities, lower cost of capital, emerging technologies that improve productivity and provide new markets, and one-on-one customer service.

With that said, some of the small businesses that responded to this question were hopeful because, they said, it was better to have such an attitude than not.  One CEO stated, “It never helped to be pessimistic. Usually we get what we epect, hence, I am utterly optimistic.”  Such an attitude is healthy, and it never hurts to acknowledge that better times are coming (even if we do not know when those are).  Even though one manager said that his sales right now are flat, his spirits were high down the road.  “ We have to keep moving up the market and as long as we do, I’m optimistic in the long run.”