Small Business Owner Optimism Reaches Four-Year Record High
January 16 2007 - 8:00AM
PR Newswire (US)
Wells Fargo/Gallup Survey: Optimism Driven by Good Current
Conditions Resulting in Positive Outlook for 2007 SAN FRANCISCO,
Jan. 16 /PRNewswire-FirstCall/ -- Small business owner optimism
reached new heights during Q4 2006 as the Wells Fargo/Gallup Small
Business Index set a record high Index score of 114. This is up
four points from Q3 2006 and is the highest level for the Index
since its inception in August 2003, when it stood at 69. The Index
is calculated based on a nationwide survey of small business owners
conducted by the Gallup Organization and sponsored by Wells Fargo,
America's number one lender to small businesses. "While many
economists are forecasting a weaker economic environment for 2007,
small business owners are, according to the results, expressing no
signs of an economic downturn," said Dr. Scott Anderson, senior
economist at Wells Fargo. "These optimistic findings indicate
expectations for a rebound in activity this year, as the forces
that have been inhibiting growth prospects -- such as rising energy
prices and interest rates, and stagnant wage growth -- reverse
course and begin supporting future demand." Looking ahead, many
small business owners are optimistic about future revenue growth.
Of the respondents surveyed, 63 percent expect revenues to increase
and 75 percent expect their cash flow to be in good standing in
2007. "Small business strength and optimism is reflected in our
overall lending to small businesses as well as increased sales of
our Business Services Packages," said Rebecca Macieira-Kaufmann,
executive vice president and head of Wells Fargo's small business
segment. "Based on the latest CRA data our small business lending
grew by more than 30 percent year-over-year. Our Business Services
Package sales increased by over 50 percent. This growth shows that
small business owners are looking for both capital and for a full
suite of financial services to better support their needs." The
Index is comprised of two dimensions: 1) Owners' ratings of the
current situation of their businesses and, 2) Owners' future
expectations regarding how their businesses will perform over the
next 12 months. Small business owners' assessment of their current
business situation is at its highest since the Index began --
reaching 49, reflecting a one-point increase from September 2006.
Small business owners indicate even more optimism about how their
businesses will perform in 2007 with the Future Expectations
Dimension reaching 65 in Q4 2006, equaling its March 2005 high
point. The overall Index score is the sum of these two dimensions
with the largest improvement coming from the Future Expectations
dimension. About the Small Business Index Since the third quarter
of 2003, the quarterly Wells Fargo/Gallup Small Business Index has
surveyed small business owners on their perceptions of current
conditions and future expectations relating to financial situation,
revenues, cash flow, capital spending, number of jobs and credit
availability. Results are based on telephone interviews with
approximately 600 small business owners nationwide conducted
November 9, 2006 through November 29, 2006. The margin of sampling
error is +/-4 percentage points. About Wells Fargo Wells Fargo
& Company is a diversified financial services company with $483
billion in assets, providing banking, insurance, investments,
mortgage and consumer finance to more than 23 million customers
from more than 6,100 stores and the internet (wellsfargo.com )
across North America and internationally. Wells Fargo Bank, N.A.
has the highest possible credit rating, "Aaa," from Moody's
Investors Service and the highest credit rating given to a U.S.
bank, "AA+," from Standard & Poor's Ratings Services. Providing
financial products and services to more than one million businesses
with annual sales up to $20 million in all 50 states, Puerto Rico
and Canada, Wells Fargo is the #1 lender to small businesses in the
United States in total dollar volume according to the most recent
CRA data (2005). The second largest national SBA lender in dollars,
Wells Fargo is an SBA Preferred Lender in 30 states and the
District of Columbia, and originated 4,937 loans for $578 million
in 2006. Its diverse business services programs provide outreach
and education to women, African American, Latino, and Asian
business owners about financial services. Since 1995, Wells Fargo
has loaned more than $33 billion to women and diverse business
owners. For more information, please visit us at
http://www.wellsfargo.com/biz . About the Gallup Organization For
more than 60 years, the Gallup Organization has been a recognized
leader in the measurement and analysis of people's attitudes,
opinions and behavior. While best known for the Gallup Poll,
founded in 1935, Gallup's current activities consist largely of
providing marketing and management research, advisory services and
education to the world's largest corporations and institutions.
DATASOURCE: Wells Fargo CONTACT: media, Sarah Pew of Wells Fargo,
+1-415-396-0866, or Web site: http://www.wellsfargo.com/
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