Nearly 9 in 10 Small Business Owners Believe Revenue in 2022 Will Outpace or Meet Last Year’s Income

Nearly 9 in 10 Small Business Owners Believe Revenue in 2022 Will Outpace or Meet Last Year’s Income

Rising inflation, supply chain logistics and labor costs remain challenges
restaurant manager and staff having team meeting

As the wave of the omicron variant continues to recede, small business owners are optimistic about 2022. Despite persistent inflation and hiring challenges, small business owners expect revenue this year to meet or exceed revenue last year.

In Upswell Marketing's Small Business Owner Sentiment Survey, more than 1,000 business owners expressed concerns over increasing inflation, but the vast majority of business owners also report having positive views about how they'll fare this year.

After COVID-19 waves, small businesses are optimistic about 2022

In August, around 57% of small businesses owners told that the delta variant threatened to close their doors. Among the businesses who stayed open, the omicron variant, coinciding with the fourth COVID-19 wave in the U.S., put further pressures on them.

But many owners have a positive outlook about 2022, despite major challenges. Here's what Upswell reports:

  • Nearly 90% of small business owners believe revenue in 2022 will be as good or better than 2021
  • 50% of survey respondents report increased revenue in 2021, and 54.7% believe 2022 will be much better than last year

Of course, results vary across industries. The most optimistic industries include auto repair, construction, HVAC, fitness, dental and real estate. The most cautious industries include retail, beauty services and nonprofit support services.

The stakes may be particularly high for retail and companies that offer product shipping. While supply lags persist, 80% of consumers in an Oracle survey reported that they would stop buying from a brand entirely if they experienced a shipment delay or a supply shortage while doing business with that brand. Many said they also want more transparency about inventory (59%) and supply chain issues (54%) from retailers.

Rising business costs a concern, but vary by region

While entrepreneurs are widely optimistic, many small business owners expect challenges to persist or even intensify in the coming months. Of the survey respondents, 91% say they faced rising costs in 2021 and they expect further increases in 2022.

But, cost concerns vary by region. In the northeast, the top concern for small business owners is now supply chain logistics while businesses in the south say staffing as their main challenge.

Regardless of region, survey respondents expect inflation and staffing issues to intensify over the coming year.

Small business owners also shared the top operating burdens they're facing right now:

  1. Recruiting and retention of staff
  2. Lack of capital and cash flow
  3. Marketing and advertising

Small business owners also reported concern about expected rising interest rates this year, which would tighten access to capital. In a recent survey, most small business owners reported wanting more federal support to survive these major pressures. Only 10% said they believe the federal government has done enough to curb inflation, while 86% said they support Congress aiding them by reauthorizing the COVID-Economic Injury Disaster Loan (EIDL) program.

Methodology: The Small Business Owner Sentiment Survey was conducted in December 2021 and January of 2022 and included 1,095 respondents of all ages in the United States. All respondents were business owners.