Entrepreneurs Practice What They Preach by Sourcing and Shopping Small, According to American Express OPEN Small Business

  Entrepreneurs Practice What They Preach by Sourcing and Shopping Small,
  According to American Express OPEN Small Business Monitor

  Small Business Owners Balancing Short-Term Realism with Long-Term Optimism

Business Wire

NEW YORK -- April 25, 2013

When it comes to supporting their local communities, small business owners
practice what they preach. According to the American Express OPEN® Small
Business Monitor, 70 percent of entrepreneurs say they purchase and source
goods and services from other small businesses.

Additionally, almost all (96%) small businesses are committed to supporting
their local communities through a variety of activities. Some of these
activities include donating to local causes (70%) and participating in
community projects (49%). Additionally, 83 percent “shop small” (shop at
independently-owned businesses in their neighborhoods) for non-business
related purchases.

“We should all draw inspiration from small businesses that remain steadfast
optimists and loyal contributors to local communities and causes despite an
economic environment that remains uncertain,” said Susan Sobbott president,
American Express OPEN. “Adversity is nothing new to the vast majority of
entrepreneurs, and our research shows that while they have concerns about the
near future, they have learned a great deal from recent trials and are better
positioned to grow in the long term.”

Long-Term Optimism vs. Short-Term Realism

Small business owners are balancing their optimistic long-term views with
realistic short-term decisions. While more than half (54%) of small business
owners remain optimistic about their business prospects, the uncertain economy
remains the top challenge to growth. As a result, there is a sense of
trepidation in short-term plans and perspectives. Only half (50%) of small
business owners plan to increase capital investments over the next six months,
on par with six months ago.

The economic malaise is also having an impact on operations. For the first
time in two years, cash flow concerns are on the rise (59%, up from 53% last
fall).

Entrepreneurs Get Satisfaction

In spite of the current economic prospects, entrepreneurs are still strong in
spirit. A large majority of business owners (92%) say they are happy with
their lives. Of these, more than three quarters (76%) say their happiness is
due somewhat or entirely to being an entrepreneur. An increasing number say
they would recommend the entrepreneurship path to a friend or family member
(66%, versus 55% in fall of 2009), a significant attitudinal shift from just
three and a half years ago.

Hiring Remains Steady; Top Business Mantra is “You are Only as Good as Your
People”

While many business owners’ hiring plans are tempered by the realities of the
economy, 31 percent plan to hire in the next six months, on par with last fall
(29%) and last spring (35%), however, 35 percent say they do not need to hire
in order to grow their businesses, up from last fall (24%) and last spring
(26%).

As a likely result of stagnant hiring, small businesses are looking for
greater productivity from current employees. There is also evidence that they
recognize great work and its connection to business growth. Nearly
three-in-ten (29%) say their business mantra is “you are only as good as your
people”. Those who adopt this mantra are more likely to reward their employees
and benefit from a more productive workforce:

  *Nearly three quarters of business owners whose mantra is “you are only as
    good as your people,” (72%) say the productivity of their workforce has
    improved over the last year, versus 60% of the total survey population;
  *More than four in ten (42%) who follow this mantra plan to reward
    employees for a job well done and give raises (on average of 8.2%) this
    year, versus 28% of the total survey population (average of 7.5%).

Small Businesses Tweet and Post to Foster Growth

After years of growth in the use of social media by small businesses, just 46
percent said they use a social media platform for their business, on par with
this past fall (49%). Seventy percent say they use social media to attract new
customers (up from 57% in the fall) and 44 percent use it to create a dialogue
with customers (up from 31% in the fall).

Additional survey results including findings by industry, geography and
gender, are available by contacting Alex Della Rocca at 212-539-3203 or
alexd@mbooth.com.

Survey Methodology

American Express OPEN Small Business Monitor, released each spring and fall,
is based on a nationally representative sample of 933 small business
owners/managers of companies with fewer than 100 employees. The anonymous
survey was conducted via telephone by Echo Research February 22-March 12,
2013. The poll has a margin of error of +/- 3.2%.

About American Express OPEN

American Express OPEN is the leading payment card issuer for small businesses
in the United States and supports business owners and entrepreneurs with
products and services to help them run and grow their businesses. This
includes business charge and credit cards that deliver purchasing power,
flexibility, rewards, savings on business services from an expanded lineup of
partners and online tools and services designed to help improve profitability.
Learn more at www.OPEN.com and connect with us at openforum.com and
twitter.com/openforum.

American Express is a global services company, providing customers with access
to products, insights and experiences that enrich lives and build business
success.Learn more at americanexpress.com and connect with us on
facebook.com/americanexpress, foursquare.com/americanexpress,
linkedin.com/companies/american-express, twitter.com/americanexpress, and
youtube.com/americanexpress.

Key links to products and services: charge and credit cards, business credit
cards, travel services, gift cards, prepaid cards, merchant services, business
travel, and corporate card.

Contact:

M Booth
Alex Della Rocca, 212-539-3203
Alexd@mbooth.com
or
American Express OPEN
Scott Krugman, 212-640-3244
Scott.B.Krugman@aexp.com