For many small and independent businesses, the big start to the holiday shopping season comes on Saturday.
The marketing campaign known as Small Business Saturday, now in its seventh year, is expected to give many retailers and service providers a bump in sales. Started in the aftermath of the recession, the campaign has increased awareness about shopping at local small businesses, not just malls and big-box stores that draw consumers on Thanksgiving and Black Friday.
- For more tips on budgeting and spending for the festive season, see our Holiday Financial Guide
“I definitely get a lot of customers because of Small Business Saturday,” said Vanessa Gade, the owner of an eponymous online jewelry store. She advertises holiday promotions on her website and social media channels including Facebook, Pinterest and Instagram.
In many cities and towns, small businesses are again collaborating on Small Business Saturday events this year. In Alexandria, Virginia, the city government and business groups are sponsoring entertainment, treasure hunts and free trolley rides to bring shoppers to the shops in the area known as Old Town.
Many consumers say Small Business Saturday events encourage them to shop at small businesses the rest of the year.
Small companies are getting healthier, and therefore are staying in business longer, according to a study by the Kauffman Foundation, which conducts research into entrepreneurship.
In the foundation’s annual Main Street Entrepreneurship report, which Kauffman based on Census Bureau figures, the percentage of new companies that survived into their fifth year of operation rose to 48.7 percent in 2014, up from 45.9 the previous year. The latest number is a three-decade high, Kauffman says.
Survival rates had fallen for five years in a row as many companies failed due to the Great Recession. The rate fell to a low of 42.9 percent in 2011, Kauffman said.
Company owners have helped their businesses survive by being more conservative. Many have avoided taking on debt. And many have scaled back their hiring or held it steady, with monthly reports on small business employment showing slow growth in company payrolls. And many owners have said in surveys, including one released last week by Bank of America, that they expect to hold to that cautious stance in 2017.
Business owners looking for help in understanding how to manage their companies’ finances can get more help from an online learning program on the Small Business Administration website. The agency’s “Money Smart for Small Business” course has been expanded to include sections on managing cash flow, planning for a healthy business and helping would-be entrepreneurs determine if owning a business is a good fit. You can see the curriculum and start learning by visiting the SBA website.