Entrepreneurs have just weathered six months of the worst economic conditions in decades. Obviously, you know very well how your business is faring, but do you know how your experience compares to that of your peers?
There is always much to be learned from our fellow business owners, which is why I recently conducted a "How Are We Doing?" survey among business associates and peer group members. Here are the findings:
- The Outlook Is Optimistic
When asked what their experience has been during the last six months, 42 percent of respondents report that their experience was "not as bad as it could have been" and 25 percent reported that they "did surprisingly well." The remaining 33 percent said things were "worse than expected."
Obviously, while this question measures outlook rather than actual results, it indicates that a full two-thirds of the small business community is in a positive frame of mind.
- Reducing Expenses Has Been Key
For many small businesses, expense reduction has been an important survival strategy. 25 percent of respondents reported they resorted to layoffs, 11 percent reduced work hours and another 9 percent realized staff reductions through attrition.
In addition, 16 percent of survey respondents cut benefits expenses by reducing healthcare costs and suspending/terminating retirement plan contributions. Others report that they reduced fixed expenses, such as rent and phone service, and limited travel and entertainment costs. As one respondent put it, "if it costs money, we try not to do it."
- Internet Activity Is Up
A significant 76 percent of respondents reported that they're relying more on web-related activities, especially with regards to marketing and sales. Of this group, 42 percent revamped their website or increased SEO activity. Others are using more email marketing and utilizing social networking.
Bottom line: the low cost of internet activity is moving many companies to market more aggressively online.
- The Year-End Forecast Is Split
We asked entrepreneurs to rate their business outlook for the remainder of 2009. The responses formed a near-perfect bell curve, with a slightly optimistic lean. 36 percent of respondents weighed in at the middle, 37 percent say business will improve, and 26 percent were pessimistic. (We used a scale of 1 to 5, with one being the most pessimistic and five being the most optimistic, where do you fit in?)
- Our Top Concerns Are Cash, Credit and Costs
When asked to list the top three issues facing their business, respondents repeatedly identified the same three worries: cash flow, credit availability and health care costs.
Interestingly, when subsequently asked to identify the three top issues facing the small business community, respondents again raised these same issues. Cash is king--and never more so than in a recession. This is clearly what's on most people's minds.
There's no doubt about it, as entrepreneurs we can learn a great deal from what our peers have to say. If you're interested in receiving a detailed survey results summary, contact me.