Earlier today, Goldman Sachs upped their expectations for a recession in the not-so-distant future raising the probability to 30% from 15%. Goldman is not alone in predicting a recession that would bring more economic pain to everyone. A survey distributed today appears to indicate that small businesses are prepared to weather the storm.
According to small business lender Kabbage (owned by American Express), 80% of US small businesses believe they can withstand a recession with 31% stating the pandemic, for better or worse, boosted their resilience.
Kabbage’s periodic Small Business Recovery Report, which tracks the recovery trends and growth outlook of U.S. SMEs, polled 550 small business leaders that indicate they are focusing on “branding, marketing, adjusting for inflation and prioritizing online sales to beat out competitors.”
Gina Taylor Cotter, Executive VP & General Manager of U.S. Small Business Banking and Kabbage, stated:
“Small businesses are traditionally optimistic through difficult times because they’re comfortable making the necessary modifications to persevere. A number of economic factors are pushing small businesses to prioritize different business components like branding, marketing and e-commerce.”
According to the survey, 83% of small businesses are concerned there will be a U.S. economic recession soon and 80% of businesses are confident that they can withstand it.
Respondents cited increasing prices by an average of 21% across industries, due to increased costs from vendors (54%) and the rising price raw materials (45%).
Kabbage notes that in the March 2022 survey, 53% of small businesses expected to be impacted by supply change challenges. This problem persists.