In a response to inflation, small businesses across the country are in the process of increasing prices. In a recent study published by Century Business Services, Inc. (CBIZ), almost 70% of small business owners reported that they are in the process of increasing prices and 19% of business owners surveyed reported that they plan to raise prices by 10% or more.
The survey, which polled over 1,400 businesses with 100 employees or less, found that top concerns for small business owners include inflation, staffing shortages and supply chain disruption.
Small business owners also citied cutting costs as an important strategy. 37% of the businesses polled reported that they are implementing cost-cutting or cost-control strategies to keep expenses down such as paperless transactions and refinancing business debt.
Adapting to inflation isn’t the only challenge small businesses are facing in 2022. Employee retention is a problem for many businesses. About 42% told CBIZ that they are short staffed by at least 10%. And 44% of the businesses polled indicated that they’re expanding employee compensation packages, including enhancements to health and financial benefits, in an effort to retain and attract talent.
Supply chain disruption and the lingering timeline between orders placed and fulfillment continues to burden businesses and consumers alike. Businesses are adapting by adjusting cash flow to accommodate for the lag in production and being proactive when communicating with clients.
Despite concerns, small businesses remain optimistic. At the end of 2021, nearly 90% of small businesses reported that they expected revenue growth in 2022. According to CBIZ, small businesses are reporting growth over 2021 and slightly fewer are experiencing revenue and profit declines when compared to the last quarter of 2021.
*The survey was conducted between March 2022 and April 4, 2022. It includes responses from more than 1,400 businesses with fewer than 100 employees in 27 industries across the United States.
*Southland Data Processing, Inc. (“SDP”) is not a law firm. This article is intended for informational purposes only and should not be relied upon in reaching a conclusion in a particular area of law. Applicability of the legal principles discussed may differ substantially in individual situations. Receipt of this or any other SDP materials does not create an attorney-client relationship. SDP is not responsible for any inadvertent errors that may occur in the publishing process.