According to a study released by Hiscox, a leading small business insurer, over half of small business owners (57%) feel better about the current state of the US economy compared to a year ago. However, despite this confidence, 90% have taken steps to prepare their businesses for an economic downturn. The 2020 Hiscox Small Business Owner Risk Study™ surveyed 1,000 US small business owners to take their pulse regarding current conditions.

Beyond the economy, small business owners are also optimistic and confident about their business's performance in the year ahead. Over half (51%) expect profits to increase in the next 12 months. Ninety-three percent of respondents are optimistic about the year ahead, and this outlook is driven by new customers (60%), steady/improved demand (47%) and new products (30%).

Despite their confidence, small business owners are preparing for volatility and an ebbing tide. When it comes to the internal risks of running their businesses, small business owners are concerned about attracting new clients (39%), maintaining profitability (34%), passing cost increases on to customers (17%) and receiving timely payments from customers (17%). External concerns about government and political issues are also top of mind, including taxes (21%), economic growth (20%) and healthcare policy (12%). While 66% feel their business is prepared for an economic downturn, only one in five feel "very prepared." Respondents are taking steps to prepare that include reducing expenses (43%), setting up an emergency savings fund (38%) and increasing marketing efforts (31%).

"Small business owners are risk-takers, so it should come as no surprise that in a strong economy they are looking to expand and grow the profitability of their businesses," said Kevin Kerridge, Executive Vice President of Small Business Insurance at Hiscox USA. "But small business owners also recognize there are many factors that could alter their plans, so many have taken steps to prepare for a change in conditions while continuing to focus on activities that will drive growth."

Hiscox USA provides a variety of specialty risk solutions, including a broad spectrum of professional errors & omissions, general liability, cyber and data security, media liability, management liability, crime, kidnap & ransom, terrorism and commercial property insurance products.

In the US, Hiscox has offices in New York, NY; Atlanta, GA; Chicago, IL; Dallas, TX; Los Angeles, CA; Phoenix, AZ; Las Vegas, NV; San Francisco, CA and White Plains, NY.