While some small businesses saw a modest improvement in their customer counts and revenues over the past quarter, unfortunately, most of those gains were wiped out by record-breaking inflation.
Q2 2022 hedge fund letters, conferences and more
SMBs Fear Shuttering By Year's End
Here are report highlights:
- Overall, only 25% of all small businesses report being fully recovered, matching or exceeding monthly revenues they generated prior to COVID.
- That’s the lowest recovery rate we’ve tracked in over a year. It’s 1% less than June’s, 2% less than last quarter’s, and 18% less than December’s rate of 43%.
- Only 20% of restaurant owners have recovered, down 13% from 33% in April.
- It’s a similar situation for retailers. Only 25% are making what they did prior to COVID, down 9% from 36% in April.
- Given higher-than-usual gas prices, car services, truckers, and others in transportation have dropped 19% from 36% in April, landing at just 17% being fully recovered now.
- Due to higher interest rates, real estate firms are struggling more, too. Only 23% are fully recovered, down 11% from 34% in April.
- 47% of the U.S.-based SMBs expressed concern that if inflationary trends don’t improve, they could shutter by year’s end. One percent of those businesses have already closed.
- One of the biggest reasons for worry comes down to this statistic: 91% reported higher costs for gas, labor, supplies, or more, but only 61% have been able to charge customers more to cover those expenses.
- 54% of SMBs in Illinois & Colorado say they could shut down by year’s end. In Colorado, 3% have already closed for good.
- 53% of New York’s small businesses have similar concerns, as do 50% in New Jersey, and 47% in California & Massachusetts.
- In Canada, the national figure is 56%, and 2% of that group already shuttered.
- Looking at the provinces, 59% in Alberta, 54% in Ontario, and 50% in British Columbia are worried about potentially closing by the end of 2022, as well, given the financial stress they're under.
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