Confidence among small American businesses would have dropped in the midst of new American rates.
It is according to a report Saturday, March 22 by the Wall Street Journal (WSJ), which said that more than 40% of small businesses said that economic conditions had deteriorated compared to last year, against 22% in February.
Among the small companies profiled in the report are the Quake City Casuals in Los Angeles, a thugs company that has absorbed about half the cost of President Donald Trump 10% price on Chinese imports Last month, and stored $ 500,000 in inventory before entering into force.
All the same, Quake City sales are down 40% this year. John GlucksmanThe president of the company, told WSJ that he had reduced the hours of his employees. The job cuts could follow if the business does not happen again by the end of the month.
“There is only a limited amount of things we can do to reduce our costs,” he said.
As WSJ noted, small businesses have fewer options at their disposal than their larger counterparts when it comes to dealing with a trade war. This has left many of these companies reducing costs and holding expansion. And like Quake City, some weigh layoffs.
The results of the WSJ comply with recent research on Pymnts intelligence showing that all small minorities of small businesses, except a small business cause a shortage of productss.
Meanwhile, the upcoming research of Pymnts Intelligence shows that around half of the small and medium -sized enterprises (SMEs) depend on immediate sales or existing cash flow for survivalWith commercial credit cards serving as the most common funding for those who have access.
“Those who do not have access to financing are much less confident in their ability to adapt to an evolving economic environment and are 75% more likely not to have the intention of compensating for the costs resulting from the implementation of prices,” Pymnts wrote last week.
“This harsh reality contributes to a feeling of increased uncertainty, as SMEs funding for funding Express less confidence than those who do it in their survival in the next two years. »»
Stressing their tenuous position, SMEs are already confronted with financial strains are more likely to use necessity financing than for the growth of the strategy. Among the companies that have used funding in the past year, companies “slightly or not at all” to survive show a higher trend to use it mainly by necessity (43.2%) compared to more stable SMEs.
“This suggests that important part of the SMB ecosystem is working in survival mode and is poorly equipped for time potential price storms And economic slowdowns, ”wrote Pymnts.