According to the latest Citibank small business survey, the majority of California
small business owners believe they are poised to grow or are already in growth mode.
Forty two percent say they are “holding their own, but poised to grow when the climate
is right” and 33 percent indicated they are already growing. Despite feeling as though
they are primed to grow should the opportunity present itself, the vast majority (88
percent) of small business owners remain concerned about the economy, including the
possibility of a double-dip recession. The results also show an increasing trend in
small businesses feeling more prepared to withstand longer-term challenges.

“We are excited about the results of this survey, which show that California small
businesses are optimistic about the future and taking action today to grow as the
economy improves,” said Rebecca Macieira-Kaufmann, President of Citibank California.
“Small businesses are the engine of California’s economy, and their improving outlook
is a great sign for the state.”

Economic Key Findings:
•  91 percent said they feel they are either very (61 percent) or somewhat (30 percent)
   responsible for the nation’s economic recovery
•  88 percent are concerned about the possibility of a double-dip recession
•  77 percent are prepared if the economy were to experience another downturn
•  71 percent plan to keep the same number of employees next year, 24 percent are
   projecting employment increases and 5 percent plan to reduce the number of
   employees
•  32 percent plan to hire temporary or part-time workers instead of full-time
   employees

As California small business owners look back over the past few years, they share that
the biggest challenges of owning/running their business have been:

•  Taxes, insurance and/or benefit costs (67 percent)

•  Declines in sales/poor economic conditions (67 percent)

•  Personal stress/being accountable for everything/everyone (63 percent).

The American Dream
Despite the challenging environment, the majority of California small business owners
(58 percent) say they are living the American Dream. 83 percent said owning a small
business helps them fulfill the American Dream. For small business owners, living
the American Dream also means being able to afford the lifestyle they want (76 percent)
and being able to save and plan for the future (79 percent) 78 percent cited “being
their own boss” as the key benefit to being a small business owner

Looking Ahead: The Rest of 2011 and 2012 Outlook
As small business owners in California look to the future months and 2012, 45 percent
say it will be “steady as she goes – continuing much as we are now” for the holiday
season.

In an effort to improve or grow their business in 2012, small business owners plan to:
Increase their marketing efforts (69 percent)
Get better pricing from suppliers, vendors or landlords (62 percent)
Introduce new products and services (56 percent)
Work longer hours (47 percent)

Looking forward to 2012, topping the list of most important issues for their business:
Consumer confidence (66 percent)
Maintaining or increasing sales (70 percent)
Taxes and/or government regulation (61 percent)

As small business owners plan for 2012, they are likely to increase:
Use of their website to drive business (66 percent)
Marketing using social networking sites (47 percent)
Use of email marketing (46 percent)

“The results of this current Citibank Small Business Survey are consistent with what
we’re seeing and hearing from our clients, in that they are being thoughtful and
prudent in their planning,” said Raj Seshadri, Head of Small Business Banking at
Citibank. “The underlying message here appears to be that small business owners
are preparing themselves for a more sustainable growth path, and are not expecting
any type of quick fix or change.”