Optimism: it used to be measured in half-full glasses. But new research puts a number on small-business owners' recent sunny outlook.
The latest report by the National Federation of Independent Business [PDF] ranks optimism among small-business owners by asking about…
- Plans to hire new employees.
- Plans to make new investments.
- Expectations for the economy to improve.
- Expectations for higher sales.
- Plans to expand inventory and the business.
So what did the survey reveal? On the whole, small businesses have a lot of confidence in their future. In fact, readings on the optimism index climbed from 96.1 in October to 98.1 in November (for reference, economists forecasted a mere 96.5).
This upbeat attitude is the highest level of recorded optimism since 2007 (i.e., right before the recession hit) and coincides with a recent high in small-business lending – no doubt a product of the rebounding economy. (Related reading: "7.5-Year High for Small Business Borrowing Bodes Well for Economy.")
The next question is: how will small-business owners put that optimism to work this year?
Pop the Champagne and Invest Accordingly
The Washington Post notes that 70 percent of small-business owners expect their overall financial health to be solid in 2015 and plan to invest back in their companies. That may mean…
- Hiring new staff to help meet increased demand.
- Expanding the business to offer new services or products.
- Moving the business out of the home or to a new location.
- Investing in new equipment and marketing.
But with all the celebrating and growing, it's important to keep your eye on other aspects of your small business's future, such as what you would do if disaster struck. Of course, that may not seem to mesh with the optimist mindset, but think of it this way: reducing your risk exposures is part of planning for your business's continued success.
So keep the champagne flowing, but remember that part of investing in your business means investing in small business insurance. The appropriate policies can help protect that new gear when it's lost or damaged, pay for your new employees' medical bills for occupational injuries, and safeguard you when a visitor suffers a bodily injury at your new office.
Making Significant Changes? It May Be Time to Update Your Policies
If you already have business insurance but you plan to make significant changes to your staff, product offerings, or property, it may be a good time to update your policies. That's because…
- Hiring employees affects your Workers' Compensation Insurance needs.
- Changing your products or services can affect your Professional Liability Insurance.
- Relocating to a new area impacts your General Liability and Property Insurance.
- Investing in new equipment can impact your Property Insurance needs.
- Purchasing that company truck you've been eying means you need to purchase or update your Commercial Auto Insurance.
Also, if you plan to launch a social media marketing campaign this year, check your General Liability Insurance to make sure it covers lawsuits over advertising injuries (e.g., libel or copyright infringements that happen on social media).
To learn more about when to update your existing insurance policies, read, "When Is It Time for New Business Insurance Quotes?"