Despite making up nearly all US enterprises and serving as a cornerstone of economic stability, small businesses are showing signs of strain as consumer caution intensifies, and operational costs rise.
According to the US Small Business Administration (SBA), the nation hosts over 31.7 million small businesses—representing 99.9% of all U.S. firms. These businesses span a wide range of sectors, from local retailers and professional service providers to small healthcare clinics and tradespeople. Their influence on employment and community resilience has long made them vital to America’s economic engine.
However the latest data paints a more complicated picture.
A July 2025 report from Fiserv, featured in Chain Store Age, shows that while small business sales climbed 4.4% compared to last year, they slipped by 1.4% between May and June. Foot traffic also dipped by 2% month-over-month, suggesting reduced consumer engagement on the ground.
Retail performance was particularly affected, with a 1.7% sales drop over the same period. Only food and beverage sales posted modest gains. Despite the monthly downturn, some annual growth was recorded—furniture and electronics grew by 4.5%, food and beverages by 4.1%, and sporting goods by 3.4%. Among services, food manufacturing saw an 11.7% rise, and professional services improved by 9%.
Prasanna Dhore, Chief Data Officer at Fiserv, attributed the slowdown to tightening household budgets: “Discretionary spending declined again in June as consumers prioritised essentials and delayed non-essential purchases.”
Analysts warn that while small businesses are historically resilient, they’re now facing headwinds not only from cautious consumer behaviour but also from structural challenges—labour shortages, limited access to capital, regulatory compliance burdens, and uncertainty around trade policy shifts and digital gaps.
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