Small businesses optimistic about the future, despite concerns about inflation and barriers to capital
Entrepreneurs continue to navigate a number of challenges operating their businesses, more than two years since the COVID-19 pandemic started. Small Business Majority and Start Small Think Big surveyed small business owners and managers in their networks to understand their current business conditions, how they are faring amid rising inflation, and what they need to maintain and grow their businesses over the next six months to a year.
The survey revealed that an overwhelming majority of small business owners are impacted by inflation (89%), closely followed by challenges in obtaining capital (75%) and disruptions to their supply chain (60%). Additionally, more than 7 in 10 minority-owned businesses (73%) are struggling to access benefits such as healthcare compared to their white counterparts (61%). Despite these challenges, more than 6 in 10 small business owners are optimistic about their business prospects for the next six months.
While federal relief programs expired or began to wind down, small business owners evaluated their access to capital. Nearly half of small business owners (46%) report that they obtained funding relief through the Paycheck Protection Program (PPP), and 39% report they received funding from the Economic Injury Disaster Loan (EIDL) program. However, the survey also found that a quarter of respondents (26%) obtained no capital since the pandemic started.
To keep their businesses afloat, entrepreneurs had to quickly adapt their operations to implement digital tools. While a majority (83%) of respondents already had a website pre-pandemic, half of those who didn’t created one during the pandemic. Only 27% of respondents felt they had a robust social media presence pre-pandemic, and this percentage increased by 35% during the pandemic.
When thinking about new strategies to combat workforce issues in the coming year, nearly half of small business owners (49%) report hiring additional staff, and half of the respondents (50%) say they plan to enter new markets or leverage new distribution channels. However, more than 6 in 10 (68%) respondents report problems in finding quality candidates in the current competitive labor market.
Even after the federal eviction moratorium ended and rent relief programs expired, small business owners are still overcoming challenges in paying their commercial rent or mortgage. Nearly half (47%) of small businesses report they are current on their rent payments, while 18% of respondents are 1 to more than three months behind.