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Small Business Trends to Watch in 2012

Steve Strauss, USA Today
Wednesday, 28 Dec 2011 | 10:47 AM ET
GOP Candidates Newt Gingrich and Mitt Romney
AP Graphics
GOP Candidates Newt Gingrich and Mitt Romney

To say we are in a time of unprecedented change in business would be a vast understatement. Whether it's the transformation wrought by our flat world or technology or social media or the seeming decline of the American economy or the Euro crisis or, oh, about 14 other things, this is both an exciting and nerve-wracking time to be in business.

Quick personal example: I first wrote "The Small Business Bible" in 2003. At that time I spent a lot of time discussing the need for small businesses to have a website. Quaint, eh? In 2007, when I wrote the second edition, the mobile business revolution — people working out of the office, on laptops, etc. — was the hot topic. This year, as I finish the third edition, I have 10 new chapters because I see that the only social media mention I made in the last edition was about (gulp) MySpace.

So yes, things change rapidly today. And while trends are intriguing to learn about for their own sake, let me suggest that they should actually be an important component of your strategic thinking and planning. Today's trends become tomorrow's realities.

In this first of two reports, here are the trends, factors, and events that will affect your business in the coming 12 months:

10. Election-year entanglement. That presidential elections have an effect on the economy and create a significant impact on small business there is no doubt. For instance, according to our own USA TODAY, the stock market may get pretty sweet later this year: "The tail end of presidential election years tend to be pretty bullish for stocks most of the time, no matter which candidate eventually wins," says the Stock Trader's Almanac. "The Standard & Poor's 500 has risen in the final seven months in 13 of the past 15 presidential election years since 1950."

Additionally, we will hear a lot of rhetoric in the coming months about how "small business is the backbone of the American economy." And we will hear it because:

1. It's true, and

2. The candidates are pandering, and

3. We are actually the solution.

Small businesses make up 99 percent of all businesses, create up to 60 percent of all new hires and foster a vast amount of innovation. That last great boom in this country — the Internet revolution — was made up of intrepid entrepreneurs with great ideas and an equal amount of cojones. Google was a small business before it wasn't, being started by two grad students. Amazonwas begun in Jeff Bezos' garage.

Small businesses hire, some become big businesses, and the candidate that corrals that presently untapped power with the right policies can send our economy soaring again. Is it Obama, Romney, Gingrich, Paul or . . . ? Well, that's what elections are for.

9. Rise of the self-employed: Either due to necessity, desire, the shape-shifting economy, or just plain smarts, there are a whole new generation of self-employed people now entering the work force.

•Generation Y has seemed to figure out that, given that job security is an oxymoron, it is smarter to consider oneself a free agent. A vast amount of them are, more and more, becoming self-employed independent contractors rather than traditional employees.

• Similarly, Baby Boomers are re-entering the workplace in vast numbers, looking to make up for fallen portfolios and to stay active.

Just consider this nugget: "Temple University officials noticed something a little out of the ordinary when they looked at the results of the post-graduation survey of 2009's undergraduate class: for the first time in the life of the survey, self employment ranked alongside banking, education and healthcare as one of the most popular career paths for recent graduates."

This new army of the self-employed is rapidly changing the face of work.

8. Deal of the day sites like Groupon and Living Social may be changing. 2011 was the year of Groupon, and why not? Who doesn't like getting a coupon for a restaurant or day spa at 50 percent off? Well, it turned out that not everyone did. For consumers, the deals are of course fantastic, but because these deals had a tendency to overwhelm some of the small businesses who offered them, the deal was not always as great as it was cracked up to be.

And for the small businesses that offered the deals, reactions were mixed. For some, the deals were an incredible boon to business. For others, they were, as indicated, overwhelming and not worth the hassle. Loss leaders should lead to leads, not losses. Expect these deal of the day deals to become more refined this year.

7. The cloud finally comes into its own. For years, pundits like me have been saying that small business should really consider moving their applications and business to the cloud. The cloud, software as a service, remote computing, whatever you want to call it, makes so much sense because it's secure, affordable and easy.

You can do your work on the cloud using Google's tools for instance, or the new Microsoft 360. You can backup your data using a remote service like Mozy, or do that and get full security from a company like Symantec. (Full disclosure: I do some work with Microsoftand Symantec. ) But whatever the case, the adoption of cloud technology is finally in full swing, and that's a great thing.

I have seen the future of software computing, and its name is The Cloud.

6. Mainstream green. Going green is not only a nice feel-good thing, but it is increasingly becoming a smart strategy being adopted by savvy businesses. It may be that you endeavor to make your office more environmentally conscious, or that you add green and sustainable products to your line, but whatever the case, going green can save you money, make you money, and make your employees and customers happy.

Green is the new black.

Next week: The top five trends.

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