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Thursday, Feb 29, 2024

Trends in Small Business: Updating Mid-Year Plan

By Steve Tannehill 2009 continues to be a challenging year for small businesses. As entrepreneurs and business owners update their plans, strategies and tactics for the balance of the year, there are four areas I would recommend they focus on: Survival Creates Innovation: Many businesses are currently focused on survival retaining customers and managing cash flow & costs. But economic stresses can also lead to innovation. It is a time for small businesses to reevaluate and redesign their business models, products and processes in order to improve productivity and increase customer value, It is a time to increase the use of online marketing tools. Small Business Formation: Perhaps surprisingly, business formation rates typically increase during a recession. With increased job losses and traditional employment options limited, many turn to self-employment / starting a small business options. For baby boomers, this trend is further propelled by the drop that most of us have experienced in the value of our homes, investment and retirement accounts, and potential inheritance. Changing Government Role: Under both Presidents Bush and Obama, the federal government has intervened aggressively in the economy in response to the economic challenges we face. At the same time California is facing an almost 25 percent revenue shortfall. Small businesses need to be aware of the impact of changes in government policy and programs. The ARRA stimulus package is making its way through the economy and we anticipate that transportation, alternative energy, and clean tech will see substantial federal spending increases. Small businesses will benefit directly through government contracting programs targeted at them and indirectly by providing goods and services to larger firms. Technology: Options for mobile “virtual offices” continue to explode. Smart phone options essentially palm top computers with embedded telephony continue to expand with the next trend being Netbook computers which now sell for as little as $200. Functionality is exploding as mapping and GPS tools are driven down to these devices. These technological innovations enable small businesses to replicate in a palm top functions that were previously the domain of larger enterprises with dedicated support staffs. Steve Tannehill is director of the Small Business Development Center hosted by College of the Canyons www.sbdc4biz.org

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