Small businesses have taken the brunt of the economic damage caused by lockdowns in March and April, and a huge force behind-the-scenes regarding overall employment in the country. The small business dynamic has shifted dramatically - PPP loans were aimed at these business, with 500 or less employees, but money ran dry quickly in April. A second stimulus program would not have as much available to loan through the PPP system. But small businesses are still shuttering doors, some might never reopen, and some might never reach old employment levels; the small business dynamic has changed substantially in a short period of time, but how it has done so is worrisome.
On a global scale, many small businesses have been concerned with four main things: having less revenues, attracting new customers, having to reduce salaries, and keeping employees safe and healthy. These insights come from Visa's (V) recent 'Back to Business' study (to read my article about that study click here). Some stores are adopting new methods to operating - offering contactless payments and pickups, in response to higher customer preference of those options in stores.
A study of over 5,800 small businesses shows a similar picture domestically, although the data looks back to April, where the situation was just beginning. However, many of the same conclusions can be drawn between this data and more recent data, like the Back to Business study as well as data from Yelp.
As a whole, small businesses reflect the 75% optimism about the future that Visa outlined, with about that level expecting to remain open at the time of the survey. Yet the variability increases in the number of businesses expecting to remain open as the duration extends, trending lower on a larger confidence interval as the duration reaches the fall or next year.
