Small Business Report: Auto Dealers Hurting But Optimistic of Economic Turnaround
BUFFALO GROVE, Ill. — During the fourth quarter of 2008, owners and managers of small automotive and other vehicle dealerships indicated that economic conditions are currently having the greatest impact on their businesses, but apparently they are looking forward to an improved economy in the next 12 months, according to the latest Small Business Research Board study released Monday.
Regarding the outlook on the general economy, 40 percent of owners and managers of automotive/vehicle dealers and the automotive service industry said they expect it to improve over the next 12 months.
According to officials, this is a 12-point increase over the second quarter of 2008. In fact, 33 percent of these professionals report their revenue and hiring expectations will remain consistent from the previous year.
The SBRB Automotive/Vehicle Dealer and Service Industry Report discovered that 40 percent of auto professionals believe the single most important issue impacting their businesses, not surprisingly, is economic conditions, an 11-point increase from the second quarter of 2008.
Another 19 percent indicated that the greatest issue impacting their business is interest rates.
The report found that 44 percent of the responding businesses said that access to credit has been more difficult to obtain. Within the next year, 12 percent will request to increase their line of credit, 24 percent will request a decrease and 63 percent expect their lines of credit to remain the same.
More than 500 small businesses participated in the overall nationwide fourth-quarter SBRB poll supported by IPA. IPA, with more than 1,800 professionals, is a large privately held provider of management consulting services to small and medium-size businesses in North America.