January was a strong month for small businesses due to stable consumer demand and subdued economic concerns, according to the latest Fiserv Small Business Index report.
Despite the end of the year-end sales season, small business sales in January were about the same as in December, increasing by only 0.1%. Compared to the same month last year, last month's sales increased by 1.7% compared to the beginning of 2023.
Consumer demand was flat from December, but small business usage varied by sector. Spending on insurance, building materials, DIY projects and accommodation outpaced other sectors in January. Meanwhile, spending on apparel, food services, personal services and professional trade contractors fell.
Small and medium-sized enterprises in the retail sector performed very well in January. Consumer demand in this sector outpaced other sectors, with sales up 0.7% from December and 1.9% from January 2022. Conversely, restaurant spending fell 4.1% month-on-month and 1.9% year-on-year, resulting in a sharp decline in overall performance. -Year.
Despite the mixed results, January proved to be a strong month for small business performance. The post-holiday period serves as a benchmark for the rest of the year, helping companies estimate what consumer demand would be in the absence of seasonal sales. Entrepreneurs can look into the remainder of 2024 with more confidence given that sales are nearly flat month-over-month.
