While the current economic downturn is a concern for most small business owners, the majority are taking it in stride, according to a recent study conducted for Bank of Nova Scotia.

The study found that the economy captured about the same amount of attention (12%) as other core elements of operating a small business, including keeping/finding customers (15%), expense management (11%) and labour/staffing issues (10%).

Three-quarters of small business owners reported moderate to no concern at all about the long term impact the economy will have on their companies.

Of the almost one third who indicated great concern, apprehension is highest among small business owners in Ontario (31%) and Atlantic Region (30%), followed by British Columbia and the Prairies, both at 27%.

“Not surprisingly, small business owners are concerned about how current economic conditions may affect the long range success of their businesses. However it is encouraging that most of this concern is more temperate in nature,” says Kyle McNamara, managing director and head of small business at Scotiabank. “Another positive sign is that the majority of business owners surveyed see light at the end of the tunnel, with more than half (52%) anticipating economic recovery within the next six months to sometime next year, while another 11% believe it’s already started.”

According to the study, small business owners cited cash flow (25%) and sales revenue (23%) as being hardest hit by the economic downturn, followed by new customer acquisition (19%) and competition (19%).

In an effort to manage current conditions, about one third (33%) of business owners have modified their business plans, focusing on expense management (40%) and adjusting employee hours/downsizing (19%). Thirty-five per cent of those surveyed said they don’t have a plan.

The study was conducted using a representative sample of Canadian small businesses obtained from InfoCanada lists. Interviews were completed between May 25 and June 5. All data are weighted by region and annual revenue to correspond with the distribution of InfoCanada’s profile of Canadian small businesses. Results can be considered to accurately reflect the opinions of Canadian small business owners to within +/- four%, 19 times out of 20.

IE