Elon Musk told an interviewer last week we’re in a recession. A second big bank just bit the dust. Mass layoffs continue in certain sectors. There’s a lot to be worried about … unless you’re the average small business that’s already battened down the hatches for a downturn.
Believe it or not, 76% of small business owners are confident their organizations will survive the downturn, according to the Bank of America 2023 Small Business Owner Report. And of the more than 1,000 business owners surveyed, 65% expect revenue growth over the next year despite rampant inflation and supply chain problems.
One big key: If debt and cash flow aren’t major headaches right now for a company, then high interest rates and bank lending freezes won’t rattle owners and execs who are steering the ship.
Keys to making money in a shrinking economy
Small businesses are bracing for rough times by making a few strategic moves. The BofA survey finds:
- 79% of business owners raised prices over the last 12 months
- 53% added benefits and perks to retain top talent, and
- 49% are planning to use automation and artificial intelligence (AI) tools in 2023.
Inflation remains the top concern (79%) for small business owners over the 12 months, followed by commodities prices (68%), government spending (68%), interest rate hikes (67%) and nagging supply chain shortages and snags (57%).
“Despite these concerns, the bottom line remains strong for many entrepreneurs,” concludes BofA. “Fifty-six percent of business owners reported increased revenue in 2022 compared to 2021, and looking ahead at the next 12 months, 48% plan to expand their business” as opposed to just 37% of owners surveyed a year ago.
