The last few months have been very good for many small business owners who were looking forward to a prosperous 2015. But now some unfortunate realities have started to set in and that, in turn, has had a negative impact on the outlook many entrepreneurs may have for the coming months.
After two months of minor increases, small business owners’ optimism fell back again in January, sliding to a rating of 97.9 after hitting 99.4 in December, according to the latest data from the National Federation for Independent Business. In most cases, the outlook across a number of categories took a hit, with only positive feelings about current inventory and job openings increasing, while those for expected credit conditions held steady.
“November and December readings were very strong, possibly from post-election euphoria. January’s decline was mostly due to owners being less optimistic about business conditions, not spending and hiring plans,” said Bill Dunkelberg, chief economist for the NFIB. “Regulation interference and taxes trump the list of concerns for small businesses while inflation risks and credit availability and costs are at the bottom. Only a net three percent of owners reported raising average selling prices. Even though there is a decline in optimism, the small business sector is operating in a somewhat normal zone. The increase in the percent of owners reporting hard to fill job openings is very good news.”
Still some positives
Meanwhile, despite the fact that many of the aspects examined by the survey took a slight step back, some conditions remained pretty strong, the report said. For instance, 26 percent say they plan to make capital outlays in the next several months, and 14 percent plan to hire more workers. Another 16 percent expect their real sales to increase, and 13 percent believe now is a good time to expand. In fact, hiring activity is still fairly strong across the board, and is now more or less in line with pre-recession norms.
Owners who want to position their companies for the most success possible in the coming months may want to consider the benefits of reducing their expenses overall. That could include finding more affordable small business insurance coverage, including policies for general liability insurance. Doing so may allow companies to save as much as a few thousand dollars per year, which can then be devoted to other aspects of their companies.
