Small business sales growth slowed in June as consumers paused their shopping
Small business sales growth slowed in June as consumers paused their spending.
That’s according to new data from financial services and payments provider Fiserv.
Consumers have been holding back on shopping as high prices for groceries and other essentials and high interest rates weigh on their pockets. The Commerce Department reported Tuesday that sales for retailers of all sizes held steady in June compared with May.
Nationally, the seasonally adjusted Fiserv Small Business Index, which measures the performance of small businesses, fell to 140 in June from 144 in May. Month-over-month sales at small businesses fell 2.9% from May, and transactions were down 1.5%. However, sales and transactions were up compared with June 2023.
The slowdown since May was driven by lower average ticket sizes as inflation slowed and consumers became more budget-conscious, according to Fiserv.
“As the quarter drew to a close, consumers cut back on spending and visits to retail stores, restaurants and other service-based businesses,” said Prasanna Dhore, chief data officer at Fiserv.
However, some of the decline may be due to short-term seasonal shifts in demand. The significant increase in spending in June came from higher insurance premiums, higher summer foot traffic, and new subscription sign-ups at web-based content hosting sites. However, consumers cut back on spending and small business visits across a number of industries, including retail, accommodations, restaurants, ambulatory health care, and professional services.
The Fiserv Small Business Index uses point-of-sale transaction data, including card, cash, and check transactions in-store and online at approximately 2 million U.S. small businesses.
