The global fabric importer, which started as a family business and now rakes in more than $50 million a year, is featured on WallStreetJournal.com today. WSJ.com used Softline moguls Jason & Rodney Carr as examples of small business owners who have taken steps to prepare for a second slump in the economy. Check it out:
Small Businesses Held Back by 'Vicious Cycle'
by Emily MaltbySmall businesses, known for jump-starting economies, aren't upholding their reputation.
During past recessions, small firms have been the forerunners in hiring and growth, and the harbingers of recovery. But this time, they are holding back, seemingly more than large companies.
The reservation appears to stem from a general uncertainty—felt by consumers and owners alike—about whether economic conditions will worsen again before they improve. Some 86% of small-business owners say they are concerned about a double-dip recession, according to a survey published by Citigroup last month.
"A lot of small businesses have direct [contact] with consumers," says Stephen P. A. Brown, director of the Center for Business and Economic Research at the University of Nevada in Las Vegas. "Consumer income just isn't back yet. Consumer sentiment about the future isn't back. And while everyone waits, everyone remains pessimistic."
Consumer confidence likely won't improve until jobs return, but businesses won't hire until consumers spend more, triggering a "vicious cycle" of unemployment and slow sales, says Mr. Brown.
Bob Brueckman, owner of a BrightStar Care franchise in Gambrills, Md., isn't prepared to expand until his cash flow improves. BrightStar, which provides in-home senior care, has brought in more customers during the recession because its services can be more affordable than assisted living or nursing homes. But customers, who are also cash-strapped, are delinquent payers. That makes it tough for Mr. Brueckman to meet payroll for his 100 employees. (read more...)
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