7 in 10 Small Business Owners Are Stressed About Inflation: Strategies to Survive and Thrive

December 9, 2025

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7 in 10 Small Business Owners Are Stressed About Inflation Climbing Even Higher

You’re not alone if you’re lying awake at night worrying about rising prices. Right now, 7 out of every 10 small business owners are seriously stressed about inflation going even higher. That’s not just a number—that’s your neighbor who runs the bakery down the street, the woman who owns the accounting firm you use, and maybe even you.

The economic climate we’re living through isn’t normal. Prices keep climbing, and what worked last year might not work this year. If you own a small business, you’re probably feeling this pressure every single day when you check your bank account, review invoices, or try to explain to customers why your prices had to go up again.

This article breaks down why small business owners are so worried, what’s actually happening with inflation, and most importantly, what you can do about it. We’ll look at real numbers, real stories, and real strategies that can help your business survive—and maybe even thrive—during tough economic times.

The Current State of Inflation

Let’s talk about what’s actually happening with prices right now. Recent data shows that inflation remains a major concern, with 58% of small businesses reporting it as their top worry. That number tells you this isn’t just media hype—it’s affecting real businesses every day.

Several things are pushing inflation higher. Supply chains are still recovering from recent disruptions. Energy costs go up and down like a roller coaster. Labor costs keep rising as workers demand higher wages to keep up with their own bills. And global events—from trade policies to conflicts overseas—affect prices on everything from computer chips to cooking oil.

Economists have different opinions about what comes next. Some think inflation will slow down naturally. Others worry it might stay high for longer than we’d like. The truth is, nobody has a perfect crystal ball.

How does this compare to history? We’ve seen worse. The 1970s and early 1980s had much higher inflation rates. But that doesn’t make today’s situation easy. Many business owners today started their companies during relatively stable times and haven’t dealt with this kind of economic pressure before.

Breaking Down the Survey Data

The research showing 70% of small business owners are stressed about inflation comes from multiple surveys conducted throughout 2024 and 2025. One study found that 62% of small business owners say inflation is their biggest source of stress, while other data points even higher.

Who’s most affected? Pretty much everyone, but the stress hits hardest for business owners with:

Less than $1 million in annual revenue
Fewer than 20 employees
Businesses that are less than 5 years old
Companies without significant cash reserves

Some industries feel the pain more than others. Retail businesses struggle because they compete directly on price. Restaurants and food service companies face rising costs for ingredients and labor. Manufacturing companies deal with expensive raw materials and energy bills.

Geography matters too. Business owners in areas with higher costs of living—like major cities on the coasts—tend to report more stress. But honestly, inflation doesn’t care where you live. Whether you’re running a business in New York City or rural Montana, you’re probably feeling the squeeze.

Why Small Business Owners Are Particularly Vulnerable

Here’s the hard truth: small businesses don’t have the same advantages as big corporations, and inflation makes that gap even wider.

First, you probably don’t have huge financial cushions. Large companies can weather a few tough quarters because they have millions (or billions) in reserves. Most small businesses operate with much smaller margins. One bad month can create serious problems.

Second, you can’t push suppliers around. When Walmart negotiates with a supplier, they have serious leverage because of their size. When you negotiate, you might be told “take it or leave it.” You need what they’re selling more than they need your business.

Third, raising prices isn’t easy. Your customers might go somewhere else if your prices get too high. Big companies can spread price increases across thousands of products and millions of customers. You might only have a handful of products or services, so each price change is more noticeable.

Competition from larger corporations gets harder during inflation. They can afford to take losses in the short term to keep customers. You can’t. They have teams of analysts figuring out how to optimize every penny. You’re probably doing the accounting yourself after closing time.

Getting loans or credit becomes trickier too. Banks get nervous during uncertain economic times. Interest rates often rise along with inflation, making borrowing more expensive. And if your recent financial statements show squeezed margins, you might not qualify for the funding you need.

Specific Business Challenges Caused by Inflation

Let’s get specific about where inflation hurts your business.

Rising Operational Costs

Your rent probably went up. Your landlord has their own bills to pay, and they’re not shy about passing those costs along to you. Utilities cost more. Electricity, heating, cooling, water—all more expensive than last year.

Raw materials and inventory eat up more of your budget. If you sell physical products, you’re paying more to stock your shelves or warehouse. A widget that cost you $10 last year might cost $12 or $13 now. Multiply that by hundreds or thousands of units, and suddenly your cash flow looks very different.

Equipment and technology aren’t immune either. Need a new computer? More expensive. Software subscriptions? They went up too. That new piece of equipment for your shop? Add 15–20% to whatever you budgeted.

Labor Market Pressures

Your employees need raises. Their groceries cost more. Their gas costs more. Their rent went up. They need higher wages just to maintain the same quality of life. And you want to give them raises—they’re good people doing good work. But where does that money come from?

Benefits expectations keep growing. Health insurance premiums climb every year. Employees want retirement contributions, paid time off, and other perks. These aren’t unreasonable requests, but they add up.

Hiring is ridiculously challenging. Good workers have options. To attract talent, you need to offer competitive pay and benefits. But your competitors are trying to do the same thing, creating a bidding war that small businesses can’t always win.

Supply Chain Disruptions

Even though the worst supply chain problems from recent years have eased, things still aren’t smooth. Lead times are longer. Products arrive late or incomplete. You can’t always get what you need when you need it.

This uncertainty makes planning nearly impossible. Should you order extra inventory to avoid shortages? That ties up cash you might need elsewhere. Should you keep inventory lean? Then you risk running out and losing sales.

Cash Flow Management Difficulties

I remember talking to a friend who owns a small printing business last year. He had steady orders, good customers, and a solid reputation. But he was constantly stressed about cash flow. “My customers pay me in 30 or 60 days,” he said, “but my suppliers want payment in 15 days. And the amount I owe them keeps going up while what I charge hasn’t kept pace.” He wasn’t failing—he was trapped between rising costs and delayed revenue.

That’s the cash flow crisis many small businesses face. The timing between when money goes out and when it comes in creates a dangerous gap. During inflation, that gap gets wider.

Pricing Strategy Dilemmas

Every price increase risks losing customers. You lie awake wondering: if I raise prices by 10%, will I lose 15% of my customers? Is it better to raise prices a little bit several times, or do one big increase? How do I communicate this to customers without sounding greedy?

These aren’t easy questions, and there’s no one right answer. Every business is different, and every customer base reacts differently.

Real-World Impact Stories

Let me share some real examples that show how inflation affects different types of businesses.

The Retail Shop Owner: Sarah runs a gift shop in a mid-sized town. Her rent increased 12% when her lease renewed. The candles, mugs, and home decor she sells now cost 20–30% more from her suppliers. She raised prices by 10%, lost a few price-sensitive customers, but kept most of her regulars. She had to cut back her inventory variety because she couldn’t afford to stock as many different items. Her profit margin, which used to be comfortable, is now razor-thin.

The Service Business Owner: Marcus owns a digital marketing agency with five employees. His biggest inflation hit came from labor costs. He gave everyone a 7% raise to help with their rising living expenses, but his clients pushed back when he tried to raise his rates. Two clients left for cheaper alternatives. He’s making it work by being more selective about new clients and focusing on higher-value projects, but the stress keeps him up at night.

The Small Manufacturer: Lisa’s company makes custom furniture. Wood prices went crazy. Steel hardware costs more. Shipping costs doubled. She had to implement a policy where quotes are only valid for seven days because prices change so fast. She’s turned down projects that would have been profitable two years ago because the margins don’t work anymore. She eliminated her lowest-priced product line entirely and now focuses only on mid-range and premium pieces.

The common theme across all these stories? These business owners are smart, hardworking, and adaptable. But even with those qualities, inflation forces difficult choices every single day.

The Ripple Effects on Business Operations

When you’re stressed about inflation and tight on money, everything else in your business suffers too.

Many business owners have put growth plans on hold. That second location you were planning? Delayed. The expansion of your product line? Waiting. The new equipment that would make everything more efficient? Maybe next year. When you’re worried about surviving this month, you can’t think much about next year’s opportunities.

Hiring freezes are common. Instead of bringing on that extra person who would make everyone’s job easier, you and your current team stretch yourselves thinner. Or worse, some businesses have had to let people go. Those are crushing decisions that affect real families.

Innovation and research and development take a back seat. You can’t invest in developing that new product when you’re worried about paying this month’s bills. This might not hurt you today, but it could put you behind competitors in the long run.

Marketing budgets often get cut first. That Facebook ad campaign? Paused. The email marketing service? Downgraded to a cheaper plan. The local sponsorship that brought good visibility? Discontinued. When money is tight, marketing feels like a luxury even though it drives future revenue.

The personal cost is huge too. The stress affects your health, your relationships, and your quality of life. You’re working longer hours, sleeping less, and enjoying life less. That’s not sustainable.

Strategies for Managing Inflation Pressure

Okay, enough about the problems. Let’s talk about what you can actually do.

Financial Management Tactics

Review every expense: Go through your expenses line by line. What are you paying for that you don’t really need? That software subscription you barely use? Cancel it. That service you could do yourself? Do it yourself. Small savings add up.

Renegotiate with vendors: Call your suppliers. Explain your situation. Ask if there’s any flexibility on pricing, payment terms, or bulk discounts. You might be surprised. Many vendors would rather work with you than lose you completely.

Improve your cash flow forecasting: Know exactly when money comes in and goes out. Use a simple spreadsheet or accounting software to track this. When you can see problems coming a month or two ahead, you have time to act.

Build emergency reserves when possible: Even if you can only save $100 a week, do it. Over time, that emergency fund can save your business during unexpected problems.

Pricing Strategies

Make strategic price increases: Don’t raise prices on everything at once. Start with your best-selling, highest-value items. Test customer reaction. Adjust as needed.

Focus on value, not just price: Instead of competing on being the cheapest, compete on being the best. Explain what makes your product or service worth the price. Many customers will pay more for better quality and service.

Be honest with customers: Tell them why prices are increasing. Most people understand inflation affects everyone. A simple explanation goes a long way toward maintaining good relationships.

Operational Efficiency Improvements

Automate what you can: Even simple automation saves time and reduces errors. Email marketing software can automate customer communications. Scheduling tools can reduce back-and-forth. Accounting automation can save hours each week.

Reduce waste: Look at what you’re throwing away or not using. Food waste in restaurants. Unused materials in manufacturing. Time spent on unproductive activities. Cut waste, and you improve your bottom line.

Optimize inventory: Don’t overstock, but don’t run out either. Find that sweet spot where you have what you need without tying up too much cash.

Revenue Diversification

Add new offerings: Can you offer a related product or service that your current customers would want? That’s often easier than finding completely new customers.

Explore new markets: Maybe there’s a neighboring town you could serve. Or a slightly different customer segment that would value what you offer.

Create alternative revenue streams: Can you offer consulting? Online courses teaching your expertise? Products with higher margins? Think creatively about how to use your existing assets and knowledge.

Resources and Support Available

You don’t have to figure this out alone. Help exists if you know where to look.

The Small Business Administration (SBA) offers various programs, counseling, and resources. They have local offices in most areas where you can talk to someone face-to-face.

Government programs and relief options change frequently, so check what’s currently available. Some states and cities offer specific programs for small businesses facing economic difficulties.

Financial assistance and loan programs exist beyond traditional banks. Community development financial institutions (CDFIs), credit unions, and online lenders sometimes offer better terms than big banks, especially for small businesses.

Business advisory services and mentorship can provide guidance. SCORE offers free mentoring from experienced business people. Small business development centers (SBDCs) provide consulting and training.

Industry associations and networking groups connect you with other business owners facing similar challenges. Sometimes just knowing you’re not alone makes a huge difference. Plus, you can share strategies and learn what’s working for others.

Expert Advice and Recommendations

What do the experts say?

Economists generally advise focusing on what you can control. You can’t control inflation rates or Federal Reserve policy. You can control your costs, pricing, and operations.

Successful small business owners who’ve weathered previous economic challenges emphasize flexibility. The businesses that survive are the ones that adapt quickly. Be willing to change your approach when something isn’t working.

Financial advisors recommend maintaining close relationships with your bank or lenders even when you don’t need money. That relationship might save you when you do need credit.

For the coming months, prepare for continued uncertainty. Don’t assume inflation will suddenly disappear. Plan for it to stick around a while. That way, if things improve faster, you’re pleasantly surprised. If they don’t, you’re ready.

Long-Term Outlook and Adaptation

Beyond surviving the next few months, think about building a business that’s more resistant to inflation in the future.

An inflation-resistant business model has several characteristics:

Multiple revenue streams so you’re not dependent on one product or service
Strong customer relationships that aren’t based purely on price
Efficient operations with minimal waste
Some pricing power because you offer unique value
Healthy profit margins that can absorb some cost increases

Developing financial resilience means building those emergency reserves, maintaining good credit, and having relationships with multiple suppliers so you’re not dependent on just one.

Agility and adaptability matter more than rigid planning. The business plan you made two years ago might not fit today’s reality. Be willing to adjust. Check in with your strategy quarterly, not just annually.

Some businesses will actually find opportunities in this challenging environment. When competitors fail or pull back, there might be market share to grab. When suppliers are desperate for customers, you might negotiate better deals. Stay alert for these possibilities.

The Path Forward

Small business owners face real challenges right now. With 7 in 10 feeling stressed about inflation, you’re in the majority if you’re worried. The concerns are legitimate—rising costs, squeezed margins, and uncertain customers create a tough environment.

But remember the strategies we covered:

Cut unnecessary expenses
Renegotiate with vendors where possible
Adjust pricing strategically
Improve operational efficiency
Diversify your revenue
Use available resources and support

You’re tougher than you think. Small business owners are problem-solvers by nature. You’ve overcome challenges before, and you’ll overcome this one too.

Take time this week to honestly assess your business situation. Look at your numbers. Identify your biggest inflation pressure points. Pick two or three strategies from this article and implement them. Don’t try to fix everything at once—just start somewhere.

Connect with other business owners. Share what’s working. Learn from each other. The small business community is stronger together than we are separately.

Small businesses are the backbone of the economy. You employ neighbors, serve communities, and create value in ways big corporations never could. The economy needs you to succeed. Your community needs you. And even though it doesn’t always feel like it, you have the skills and determination to get through this challenging time.

The inflation crisis won’t last forever. But the resilience you build now will serve your business for years to come. Keep going. Keep adapting. Keep believing in what you’re building.