Small businesses are fighting for survival, but optimistic that economic improvement in the US will spread to Bermuda.Kristi Grayston, head of the retail division of the Chamber of Commerce, said that if conditions do not improve soon, many small businesses would have to make tough choices.“I don’t know of anyone who is flourishing,” she said. “I might be wrong, but I haven’t spoken to anyone who’s said this has been their best year ever and life is great. People are generally nervous.”“If things here don’t turn around by fourth quarter, I just can’t imagine it. I’m not sure that I could do it. It makes you think long and hard about if you want to do this.“The feeling right now in Bermuda is that we’re all in this together, and we’ve got to weather the storm.”She said the downturn has impacted all businesses on the Island, not only through a general reduction in visitors to the Island, but a general lack of confidence in the economy.“When the whole recession started in the US and Bermuda really hadn’t been affected, people zipped up their purses saying ‘Oh, we’re in a recession’.“People see it in the news in the morning and we see it when we ring off in the afternoon. Now, all of a sudden things are so severe, people are unemployed and companies have austerity measures in place.“Even though you’re hearing better news in the US, it’s not turning into better sales for us.“Now reality is kicking in and people are concerned about their employment possibilities. It’s scary. Times are tough.”She said that many smaller businesses have been working to find ways of reducing their operating costs in order to stay afloat.“I think a lot of small businesses are working closely with their bank representatives to see what if anything they can do,” she said. “I know they are working with landlords to get reduced rents.“Everybody at every turn you come to, everyone is trying to come up with more creative ways of reducing costs. In some regards, if it’s a very small business, just an owner and an employee, then it helps. It’s easier to make changes.”While she hopes that the budget, scheduled to be announced later this week, holds some positive news for Bermuda’s small businesses, she acknowledged that tough times could mean more bad news.“I wouldn’t want to be the Premier [Paula Cox] this week. I think she will have some tough choices to make.”Joel McDonell, who runs the Bermuda Jam Factory with his partner Grant Kennedy, said the small size of their business has helped them keep going.“There are definite benefits to being smaller in size,” he said. “There’s a greater level of flexibility, and you can change and adapt a little faster.“Our overhead costs are lower. That’s a tough one when you are a large business with set overheads. You really need to be cracking some sales to keep it up and running.”Overcoming the high costs of running a business in Bermuda has proven a challenge, Mr McDonell said. He and Mr Kennedy found assistance with the Chamber of Commerce and their bank representative.“We’ve had to really prioritise our expenditure and decide what we really need to have right now, and what we can bypass for now and maybe get down the road.“We’ve definitely had our ups and downs with the economy. We’ve had to be a lot more creative with our product and how we get it in front of people. You have to get out in front of customers. We can no longer rely on them just showing up at the stores.”Useful websites: www.bermudacommerce.com, www.bermudajamfactory.com.