I recently ran across a Wall Street Journal piece about the credit crunch’s continuing impact on small businesses.
Of course, there’s been significant talk about economic recovery lately, and the government had made a number of moves to unfreeze credit. So it might be easy to think that our small business clients see a light at the end of the tunnel. But Meredith Whitney, CEO of Meredith Whitney Advisory Group, LLC, warns that we’re only about halfway through this credit crisis, and this is bad for small businesses.
“Since the onset of the credit crisis over two years ago, available credit to small businesses and consumers has contracted by trillions of dollars, and that phenomenon is reflected in dismal consumer spending trends. Equally worrisome are the trends in small-business credit, which has contracted at one of the fastest paces of any lending category. Small business loans are hard to find, and credit-card lines (a critical funding source to small businesses) have been cut by 25% since last year.”
She also says that home equity loans are still hard to come by, which means even less money available to small business owners through that credit line.
Since a critical component of our business is helping other businesses generate leads and grow sales, these predictions should be top of mind for all of us.
Our sales teams in the field working with business owners must understand that their advertising resources might continue to be tight for some time to come. As always, that means the responsibility is on us to demonstrate value and ROI to our clients. Now more than ever, we must present solutions that address the specific objectives of individual businesses, and we must demonstrate that those solutions help our clients achieve their goals – however idiosycratic they may be.