Page 12 - aruba-today-20220912

A12 BUSINESS
Monday 12 SepteMber 2022
As small businesses raise prices, some

customers push back

By MAE ANDERSON
AP Business Writer
NEW YORK (AP) — Inflation
isn't only costing small busi-
nesses money. It's costing
them customers as well.
At the Bushwick Grind
Cafe in Brooklyn, New York,
Kymme Williams-Davis has
raised prices and switched
to different types of goods
to keep up with the rising
costs of milk, coffee, pa-
per goods and plastic, as
well as shortages of items
such as paper cups and Kim Shanahan, who operates online store Gifts Fulfilled, stacks
plastic lids. She hasn't ex- Get Well Soon boxes in her shop, Thursday, Sept. 8, 2022, in
perienced anything like this Berlin, Md.
since opening in 2015. Associated Press
Williams-Davis says she has on spending. But now own- restricted income like So-
lost nearly half of her regu- ers say they're seeing some cial Security, they say they
lar customers. Some have pushback. have to cut back," she
traded down and are buy- Ninety-seven percent of said. "They say, 'I know I
ing coffee for $1 at the small business owners say need these tires, but I need
McDonald's or bodega on inflationary pressure is the to make a couple more
either side of the café in- same or worse than it was rounds (of Social Security)
stead of paying the $3 she three months ago, accord- to save up.'"
charges. ing to a survey of more She says she's a little wor-
"If (customers) can get it for than 1,500 small businesses ried but hopes people can
a dollar for not that notable by Goldman Sachs 10,000 adjust to inflation.
of a difference, they're go- Small Business Voices. Sixty- "Right now , it kind of sucks
ing next door." five percent have raised because costs increased
One customer who had prices to offset higher faster than I could catch
been coming in for years costs. And 38% say they've up with. In time, I hope
stopped in to tell Williams- seen a decline in customer people budget better and
Davis he bought himself a demand due to price in- their incomes change to
coffeemaker. creases. Nicole Miskelley, reflect the economy."
"He said I'm going to start who manages PMR, an The pullback is more dra-
making coffee at home, I auto and diesel repair shop matic among consumers
need to budget, so I won't in Marion, Illinois, said she with less discretionary in-
be coming in here every has seen customers delay come. Walmart says its cus-
day," she said. "I feel like repairs that aren't urgent tomers, who tend to have
I've been on a goodbye such as scheduled mainte- lower incomes, are spend-
campaign." nance or getting new tires. ing more on food and less
Inflation has been rising At the beginning of the on other items. Small busi-
at nearly the fastest pace year, Miskelley's labor costs ness owners are seeing
in 40 years, driven up by rose 12% and the cost of much of the same.
strong consumer spending towing cars to the shop Kim Shanahan operates the
and higher costs for food, went up due to higher gas online store Gifts Fulfilled in
rent, medical care, and prices. Parts are more ex- Berlin, Maryland, which sells
other necessities. pensive too. Last year, an gift baskets and care pack-
On Tuesday, the govern- air conditioner processor ages and employs people
ment is expected to report would cost her $200, but with disabilities.
that price increases slowed this year she can't find one "Last year has been chal-
in August compared with a for under $400. So, she's lenging to say the least,"
year ago, largely because had to raise her average she said. "All prices across
of a steady drop in the price for a repair by 30% to the board have gone
cost of gas. Prices for other 40%. up." Everything from card-
items, particularly food, are Her customers have no- board, containers and the
likely to keep rising quickly. ticed. food that she includes in
Overall, economists fore- "Typically, I am able to joke the baskets have become
cast consumer prices rose about how drastically dif- more expensive.
8.1% in August, compared ferent things are now and She implemented a 5%
with a year ago, down from most agree with me," she increase to cover some
8.5% in July, according to said. "On occasion, I deal costs. After she raised the
data provider FactSet. with push back," including price of her most popular
For much of the pandemic, the rare bout of yelling or get-well gift basket called
small business customers cursing by a customer. "One Tough Cookie," from
were largely tolerant of "Among a lot of my older $27.50 to $28.95, sales went
price increases and kept customers, who are on down, she said.q