Small Is the New Big: The State of Small Business

Small Business Saturday® isn’t until November, but it will be here before you know it. Since the day was started by American Express in 2010 it has been a huge success. In 2018 alone U.S. consumers reported spending an estimated $17.8 billion at independent retailers and restaurants on Small Business Saturday1.  

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Small Is the New Big: The State of Small Business

Aug 26, 2019

Small Is the New Big: The State of Small Business

Small Business Saturday® isn’t until November, but it will be here before you know it. Since the day was started by American Express in 2010 it has been a huge success. In 2018 alone U.S. consumers reported spending an estimated $17.8 billion at independent retailers and restaurants on Small Business Saturday1.

But shopping small isn’t just about one single Saturday. Shopping small has become a movement for businesses and consumers across America.

Small Businesses Are Thriving All Year

As a segment, small businesses are stronger than ever: According to the National Federation of Independent Businesses (NFIB), optimism remains strong among small business owners. High percentages of those surveyed are seeing strong profits and making plans to continue hiring. In the words of NFIB Chief Economist William Dunkelberg, “the small business sector remains exceptional.”

There are many reasons why small businesses are doing well in today’s economy, including shifting priorities among customers, support from local governments in many areas, and better support from card brands like American Express. In addition, as Millennials and Gen Z gain greater purchasing power, they often prefer to support small businesses instead of large corporations.

In fact, surveys indicate that many millennials will even pay more to support small businesses. They often view products from small businesses as more authentic as compared to large established brands—consider the famous example of the beer industry, where small craft breweries are growing and mass-market beers are losing market share.

How Better Technology Has Helped Small Business

There are other technological factors that have helped as well—a revolution in retail and payment technology has been a large part of it, for instance, by allowing small businesses to offer their customers the best experience possible.

Modern payment technology is more sophisticated than ever, and it’s increasingly available to businesses of any size. Until only recently, point-of-sale solutions that offered features like reporting, inventory, and trends data were not available to small business because they required too much investment and resources.

Now that they’re available, it allows stores to connect to the customer with deeper insights into what they want. Simple checkout leaves customers more satisfied, and features like loyalty create return business.

Local Support Is Crucial

If customers buy local, that means they’re invested in local. In fact, an average two-thirds of every dollar ($0.67) spent at a small business in the U.S. stays in that local community2. It doesn’t have to be anything extensive, but your involvement in community events could show that you support the local community. And local chambers of commerce are often great resources, helping to organize and promote small business events throughout a town.

And be sure to leverage the biggest advantage small businesses may have—a more personal experience. When customers come into a local store, they have concerns beyond mere price. They’re looking for good customer service, quality products, even interesting backstories. Make sure your customers feel welcomed in your store and a part of your story.

Prepare For Small Business Saturday and Beyond

Small Business Saturday is still months away, but to fully take advantage of such a big day it’s crucial to start preparing now. American Express is here to help you get started. Checkout the free materials for download here to help you show your support of the Shop Small Movement and make the most of the upcoming 10th Small Business Saturday this Nov 30.

1The statistic cited is an estimate based on projections from a nationally representative sample of adult consumers as reported in the 2018 Small Business Saturday Consumer Insights Survey commissioned by Amex and NFIB. The Survey gathered self-reported data and does not reflect actual receipts or sales.

2The statistic cited is an estimate based on calculations using data on small businesses with under 100 employees from the U.S. Small Business Administration, as reported in the 2018 Small Business Economic Impact Study conducted by Econsult Solutions, Inc. (ESI) on behalf of American Express.

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