Most small business owners remain optimistic heading into 2021

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A new survey of Capital one Business reveals that small business owners are cautiously optimistic. And many are looking for a return to more favorable commercial conditions in 2021.

According to the November-December 2020 survey, approximately 53% of small business owners say their business’ financial condition is the same or better than pre-COVID-19. An additional 67% of owners are confident their business will return to pre-pandemic operations and revenue. So there is growing optimism about the state of the economy and the potential resilience of small businesses.



Capital One Survey Shows Small Business Optimism

This despite a slight decrease compared to three months ago. Next, 57% of business owners said their financial situation was the same or better than before the pandemic.

Other study findings:

  • 85% of business owners are confident they will still be in business six months from now.
  • 75% of business owners have retained or increased their number of employees since the start of the pandemic.
  • Looking ahead, 60% of owners are confident that the outlook for the U.S. economy will be business-friendly in 2021.
  • 69% of respondents say providing customers with a secure shopping experience is a top priority for their business.
  • 78% say that with their marketing budget reduced, they rely on word of mouth to attract customers to their business.

Not out of the woods yet

Despite continued levels of confidence and optimism among small business owners, an increase in COVID-19 infections and negative impacts on supply chains have companies concerned about their success over the next six months.

Nearly three in four businesses, or 73%, say they are concerned that an increase in COVID-19 infections will impact their overall business success over the next six months. This also includes supply chain/vendors for 65% of owners, who say (71%) this will affect their performance in Q4.

Declining sales are also a concern for small businesses this holiday season. Some 42% of businesses said their sales had declined over the past three months. The October-December period represents at least 25% of annual sales for 49% of companies. About 41% of companies expect fourth-quarter sales to decline from the same time last year.

To mitigate this, 89% of businesses plan to cut costs and purchase PPE to help their business weather the pandemic over the next six months. Only a fraction (11%) report temporarily closing or planning to temporarily close due to the pandemic in the next six months.

Image: Depositphotos


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