From The Co-Founders


Tips, Tactics & Strategic Insights and Commentary
from The ROI Co-Founders, Pat Johnson and Dick Outcalt
Outcalt & Johnson: Retail Strategists LLC; Retail Turnaround Experts

“Why Is Inflation So Stubborn? Ask Your Local Small Business”

Perhaps you saw that recent article* in The Wall Street Journal. As Ruth Simon reported, "The cost pressures squeezing small businesses – and their need to pass along those higher charges – help explain why inflation has been so stubborn."

  • Over 80% of small business owners cited rising labor costs as the greatest impact on their cost of doing business.
  • Two-thirds of owners identified the rising costs of Commercial Insurance, Goods/Inputs, and Employee Benefits (including health insurance) as most significant. (see chart**)

According to that article, these inflationary pressures represent a new kind of challenge for those SMB owners.

  • Owners described having to make repeated pricing adjustments within short periods of time.
  • Or revisiting their planning assumptions after just a few months.
  • Or needing to weigh the effects of pay raises against their customer's tolerance for price increases.

Of course, this is not exactly news for retailers. In retail, change is the name in the game.

Most knew that coming out of the pandemic, we would not be “getting back to normal.” Owners readied themselves and their businesses to deal with the “new normal.”

But, the problem is, there’s no one “new normal.” 

Plus, each potential “new normal” doesn’t stick around very long. Challenging times indeed.

We have no magic solutions. But here’s a question that might help you get started: “How do we put the fun back into the business?” Pursuing the answers to that can be re-energizing.

These challenging economic times are a reminder to us of why we initially launched The Retail Owners Institute, and continue to build it with your support. The best defense is smarter owners.   


*  Small Businesses Pass Along Inflation’s Steady Pain. Ruth Simon, The Wall Street Journal, May 14, 2024

** Nationwide survey of 1.259 small business owners taken April 15-20, 2024. Source: Goldman Sachs

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