WY We Care
Approximately 89 percent of all businesses in Wyoming are “small business,” meaning they have less than 20 employees. According to the Department of Workforce Services, one third of Wyoming employment is found in small business. With such a large portion of our economy represented by small business, it’s important to keep up-to-date on challenges and solutions.
The Big Picture
Inflation remains the top concern for a majority of small business owners (54%) according to a recent poll by the Chamber. In comparison, other issues like revenue, supply chain issues, and rising interest rates remain distant second-tier worries.
Here are the top concerns of America’s small businesses according to the latest MetLife and U.S. Chamber Small Business Index.
1. Inflation
A majority (54%) of small business owners cite inflation as a top concern. In fact, inflation is the top concern for small businesses regardless of region, number of employees, or sector.
This is also the fifth consecutive quarter that inflation has topped the list of challenges small businesses see, and consistent with findings in Q4 2022 (53%). No other concern comes close.
“I would say inflation is still going up,” says Hrag Kalebjian, owner of Henry’s House of Coffee in San Francisco, CA. “Case in point is our cost of coffee, labor, and overhead like gas and electricity…The challenge is keeping up with these costs, and constantly raising my prices. It seems as though I can’t keep up.”
2. Revenue
Revenue is the next biggest challenge cited, but falls far below inflation as a top concern. Just 22% of all small businesses surveyed see revenue as a top challenge.
Despite downbeat current views, a majority (64%) of small businesses expect their revenue to increase over the next year.
However, some small business says a lack of current revenue can be an obstacle to accessing capital. When it comes to loan financing specifically, nearly half of small businesses (46%) say that not having enough revenue or assets to qualify for a loan makes it difficult for them to get financing.
Small businesses with fewer than five employees are most likely to report not having enough revenue or assets (to qualify for a loan) as a barrier to financing. In fact, half of them report facing this issue, compared to just 40% of small businesses with 5-19 employees and 36% of those with 20-500 employees.
3. Supply Chain Disruptions
Coming in just after revenue, 21% of small businesses said supply chain issues are a top concern.
There’s a general perception among small businesses that supply chain disruptions are declining. Small businesses’ concern over supply chain issues reached a peak in Q2 2022 with 28% reporting it as a top concern. Since then, it has generally trended downward with 26% in Q3 2022, 20% in Q4 2022, and 21% this quarter saying supply chains are a top concern.
Supply chain concerns vary by sector. Small business manufacturers (28%) are more likely to say supply chain disruptions are a top concern, while small business in services (15%) are least likely to say so. Retailers fall in between: 26% of small retailers say supply chain issues are a top concern.
4. Rising Interest Rates
Concerns about rising interest rates are consistent, but remain at a relatively low level.
16% of small businesses say rising interest rates are a top concern. This is the same level of concern as last quarter (16%), but nine points higher than last year (7% in Q1 2022).
However, rising interest rates are causing some in the small business community to say they are seeking out financing more earnestly. Two-thirds of small businesses (66%) say that rising interest rates are limiting their ability to raise capital or financing for their business. Larger small businesses—those with 20-500 employees—are more likely to say that inflation is forcing them to seek out more capital (75%) and that rising interest rates are limiting their ability to raise capital (77%) than those with fewer than 20 employees.
Story by US Chamber