Here’s a snapshot… if you don’t have time to go through the whole CNNMoney piece…
- Rising costs of providing health insurance is a real concern, and in 2009 President-elect Obama has promised to create a National Health Insurance Exchange that will allow small businesses access to insurance pools that can negotiate better rates. Most observers think that health care reforms won’t be addressed until after an economic stimulus package is passed first, at least after the first half of 2009.
- Banks are clamping down on credit lines for many businesses, and some owners may now be unable to get the funding they need, even with good credit and solid financial footing. To help offset the restrictions on business growth, the Federal Reserve has created the Term Asset Backed Securities Loan Facility, set to launch in February, that hopes to ease credit for both consumers and small businesses.
- Tax stimulus plans abound… and despite what the Presidential candidates claimed during the campaign, 97% of us, including small business owners, would see no change in income taxes as a result of plans discussed. It’s most likely, now that we’re officially in a recession, that the Bush tax cuts will not be repealed but instead allowed to expire in 2010. President-elect Obama is working on his own stimulus plan that’s expected to include some form of a employee only reduction in payroll taxes.
- Layoffs are on the horizon, while last year small businesses held off on trimming staff, larger companies did undergo massive reductions. Unemployment now stands at 7.2%, or 11.1 millionof us. Small business owners are totally feeling the pinch, cutting employees now that the holidays have past, and working longer, harder hours themselves. If you do need to hire, you’ll have your pick of candidates, and when times improve, small businesses are typically first to start hiring again.
- Roller coaster costs like what’s happened to gasoline in the last few months — surging in the summer, dropping through the fall to hit a 4 year low in December. But gas isn’t the only cost of doing business that’s ridden the roller coaster — steel and iron prices surged, costs for grain and other raw materials were also all over the place last year. While gas prices are expected to stabilize through 2009, the dollar is also expected to fall against the euro, forcing companies that do business overseas to deal with increased costs.
- Fighting for buyers as the economy did its downslide, consumer spending slowed and a combination of the weak economy and bad weather led to a drop of as much as 4% in holiday sales over 2007. More shutdowns are expected in the next 12 months, and consumer confidence is at an all time low. With the tight jab market and less credit available to fuel our spending, expect consumers to still be cautious for some time yet.
No doubt about it… 2009 (or at least the first half of it) is going to be a challenging time for small business owners. It might not be easy, but if you wanted easy, chances are you’d be working for someone else.
The eternal optimist in me must add that the “economic emergency” (according to my local news) isn’t as big and bad as they’d have us believe. According to some, internet businesses will enjoy a healthy year. It may well be that the best watchwords for 2009 are efficiency and having a sound strategy for running your business