Recent rise in inflation affects growing number of small businesses: survey
Recent rise in inflation affects growing number of small businesses: survey

As inflation worsens in the United States, its impact on businesses and organizations also worsens. With no signs of letting up any time soon, the trend seems to be hitting small businesses particularly hard and creating crises for their owners.

The bank rate reported“More than half (or 53%) of experts polled for Bankrate’s first quarter economic indicators survey say inflation is likely to be higher than seen over the next 12 to 18 months, amid persistent supply bottlenecks and labor shortages, as well as new inflationary pressures in energy and food after Russia’s February 24 invasion of Ukraine.

The impact of inflation on small businesses

A new investigation published today by the online payment platform to see shows how badly small business owners have been affected by the recent rise in inflation, which has created crises for many of them.

Veem said the results of their State of Small Business: Fighting Inflationary Pressures included these issues:

More impact

  • 41.5% of small businesses report experiencing inflationary pressures in the past 1-3 months. In comparison, 25% of small businesses say they have experienced inflationary pressures in the past 10 to 12 months.
  • Nearly 40% of small businesses surveyed report feeling inflationary pressures surrounding their procurement costs.

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  • About one in five small business owners have considered taking out a loan to boost their cash flow to counter rising inflationary pressure.

Dark Outlook

  • As supply chain issues and pandemic-era worries continued into 2022, small business owners have a gloomy outlook on inflation relief, with 51.5% saying the inflationary pressure will not be resolved by the end of the year.

About the survey

Veem surveyed 829 small business owners using Survey Monkey. The poll, which was conducted from March 1 to 11, has a margin of error of +3/-3%.

Surprising discovery

Marwan Forzley, CEO of Veem, noted that he was very surprised by the survey results that “a quarter of small business owners are worried about whether their business will survive amid inflation.” Why? Because “it shows that business leaders continue to grapple with macro issues,” he said.

Forzley predicted that “inflationary pressure will continue to have a dominant impact on the day-to-day workflows of entrepreneurs looking to grow and grow their businesses. General sentiment is being tested as major economic events unfold and business leaders are put to the test.

Advice for entrepreneurs

  • Business leaders must factor the impact of economic issues and trends into their crisis management plans.
  • When testing crisis management plans, practice reacting to worst-case scenarios related to the economy such as depressions, recessions, inflation, and stagflation.
  • Make sure you have the resources (or can access them) that your business or organization will need when the worst economic scenarios become reality.

Forzley said: “Small business owners need to remember that we live in a globalized world with resources available that otherwise would not have been accessible just a few years ago. Thanks to the interconnectedness of our economies, business leaders can source materials, hire workers, and conduct business around the world to help them run their day-to-day operations.

He advised that getting leaner would be “essential to offset the pain points of rising prices. Small business owners can hopefully harness the power of our global society to connect with the resources they need on their entrepreneurial journey.

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