Managing Through Recession Sharpens Business

Entrepreneurs Say Managing Through Recession Makes Them Sharper Business Owners, According to the American Express® OPEN Small Business Monitor

Small business owners’ sentiment over the economy may have hit bottom and started to rebound, particularly among retailers.

NEW YORK--(BUSINESS WIRE)--More than three quarters of entrepreneurs believe managing through the recession has made them better business owners, according to the American Express OPEN® Small Business Monitor, a semi-annual survey of business owners. Four in ten business owners have an optimistic outlook on near-term business prospects, on par with one year ago when the macroeconomic climate was significantly different. Nearly four in ten entrepreneurs feel the current economic environment creates opportunities for their business.

While optimism has stabilized, business owners are still managing their firms with caution. Capital investment plans are at their lowest level in the eight-year history of the Monitor, hiring plans are down significantly and many entrepreneurs are adjusting their own retirement plans. Forty-two percent of business owners plan to make investments as a way to grow their business over the next six months, down from 53% last spring. Just over one-quarter of entrepreneurs have plans to hire this spring (28%), which is among the lowest Monitor readings in its history.

"There is no doubt the struggling U.S. economy has tested business owners’ resilience, but the entrepreneurial spirit remains strong and innovative” said Susan Sobbott, president American Express OPEN. "It is a positive sign that optimism – often a leading indicator for business growth– is at levels comparable to last year, suggesting a rebound in business owners’ perspectives and their renewed focus on finding the opportunities even in our battered economy.”

More than one-third of small business owners say that the current economic environment is creating opportunities for their businesses, according to the American OPEN Small Business Monitor, a semi-annual survey of business owners. Four-in-ten business owners have an optimistic outlook on near-term business prospects which is on part with spring 2008 when the macroeconomic climate was dramatically different.

Although small business owners may be feeling more confident about the economy, they are wary about expanding. According to the Monitor, capital investment plans are at their lowest level in the 8th year history of the survey, hiring plans are down significantly and many entrepreneurs are putting off retirement.

When times get tough, the tough get creative. Small business owners are finding new resources to tap and alternate ways to manage costs, including: instituting hiring freezes (48%); bartering for new products or services (45%); refusing to take a salary (30%); having a family member work pro bono (27%); renegotiating leases and supply contracts (25%); working a second job (18%) and cutting benefits (16%).

Survey Methodology

American Express OPEN Small Business Monitor, released each spring and fall, is based on a nationally representative sample of 727 small business owners/managers of companies with fewer than 100 employees. The anonymous survey was conducted via telephone by Echo Research from February 24- March 9, 2009. The poll has a margin of error of ±3.6%.

American Express Company www.americanexpress.com is a leading global payments, network and travel company founded in 1850.

Please contact Alex Della Rocca at 212-539-3203 or alexd@mbooth.com to receive copies of the data breakouts, to speak to an American Express OPEN spokesperson who can weigh in on the survey topics, to hear from entrepreneurs that can offer firsthand comment or with any questions. Breakouts are available by key business sectors (retail, manufacturing and business services), gender and geography.