In the face of fluctuating economic conditions, small businesses across the United States have ushered in 2024 with a promising display of resilience, as revealed by the January edition of the Fiserv Small Business Index. Published on February 5, 2024, by Fiserv, Inc., a leading provider of payments and financial services technology, the report offers a comprehensive overview of the performance of small businesses at national, state, and industry levels, presenting an optimistic outlook for the year ahead.
The Fiserv Small Business Index stood firm at 138, indicating a consistent level of consumer spending. This stability is mirrored in the modest month-over-month sales growth of +0.1% and a more notable year-over-year increase of +1.7%. Although this growth has slightly decelerated from the +2.6% uptick observed in December 2023, the figures represent a healthy demand for consumer goods and services.
Prasanna Dhore, Chief Data Officer at Fiserv, highlighted the adaptability of small businesses amidst challenging weather conditions across the country, noting, “Small businesses maintained steady sales in January.” The Retail sector, in particular, showcased its robustness, outperforming the overall small business category with growth fueled by consumer expenditures on building materials, health and personal care, and general merchandise.
Retail Sector Shines with Positive Growth
The Retail sector’s performance is a testament to the enduring consumer demand post-holiday season, with the January index for Retail climbing to 143. This represents a 1-point increase from December, equating to +0.7% month-over-month sales growth and a +1.9% year-over-year improvement. Notably, foot traffic in retail saw a significant rise of +4.2% year-over-year, underscoring the continued consumer interest in goods expansion beyond the festive period.
However, not all sectors fared equally. The Food Services and Drinking Places subsector experienced a downturn, with the January index dropping to 122, a 5-point decline from December. This sector saw month-over-month sales decrease by -4.1% and a year-over-year fall of -1.9%, reflecting a post-holiday adjustment in consumer spending patterns.
Diverse Sector Performance Indicates Varied Consumer Priorities
The Specialty Trade Contractors and Professional, Scientific, and Technical Services subsectors presented mixed outcomes. The former witnessed a slight month-over-month sales dip of -0.5%, settling at a January index of 145, while the latter enjoyed a robust year-over-year sales growth of +6.0%, with a January index of 148.
Fiserv Small Business Index: A Tool for Insight
The Fiserv Small Business Index distinguishes itself through its reliance on direct consumer spending activity, utilizing data from approximately 2 million U.S. small businesses. This approach, grounded in transactional data rather than surveys, offers a tangible measure of consumer spending and customer traffic, providing valuable insights into the small business ecosystem.
For small business owners, the insights from the Fiserv Small Business Index offer a roadmap for navigating the evolving market landscape. The data underscores the importance of flexibility and understanding consumer trends, which are crucial for adapting strategies and seizing opportunities in a competitive environment. As we move further into 2024, small businesses that align with consumer preferences and market dynamics will likely continue to experience growth and success, reinforcing the critical role they play in the broader economy.
Image:Fiserv
This article, "Latest Fiserv Report Reveals Steady Start to 2024 for Small Businesses" was first published on Small Business Trends
via https://www.aiupnow.com
Small Business Editor, Khareem Sudlow
