25% Of Small Business Owners Fear They Will Not Survive

Staff Writer Jan 21, 2009

A recent poll conducted by the National Federation of Independent Business Research Foundation found that around one in four of all small businesses fear that they will not be about to survive the recession our economy currently faces.

Many businesses, although maybe not fearful of surviving, are certainly worried about the economic impact their business will experience during the recession. This is the reason around 16 percent of small business owners said that the economic downturn has depressed business prospects for the short term at the very least.

The fact of the matter is that tight credit does not seem to be the issue although many people are under the impression it is. The real issue is sales and poor sales. Around 45 percent of small business owners said that one of the their biggest problems is a slow down or loss of sales. However another 23 percent claimed the unpredictability of the economy and business conditions are their biggest issue. While another 9 percent of small business owners cited difficulty obtaining credit, which was also the same percentage with decreasing real estate values.

“The fundamental small-business problem is the poor economy, abetted by the drop in real estate values and the nation's financial turmoil," said William Dennis, who directed the poll for NFIB. "Efforts to provide additional credit, whether through encouraging bank lending or government loan guarantees, are not likely to be of much help to small-business owners," he said.

"Those businesses who report they can't get credit are typically unable to absorb more debt." A better solution, he said, is a six-month holiday on payroll taxes, which would in return allow much more flexibility to businesses and their employees.

These are the reasons that so many different people are unsure of the economy and their businesses ability to perform and be successful in the future. There are many businesses that have already started giving up hope, however there are many that have been able to thrive even during tough times. The good news is that there are some definitely viable options for many businesses going through a rough financial time that will help to get their balance until the uncertainty of the economy is sorted out.