Increasing energy and fuel costs have become the main concern for small businesses, according to a nationwide study sponsored by the International Profit Associates Small Business Research Board.
Of the 358 small business owners polled in July, 15 percent named energy and fuel prices as the primary issue affecting their businesses. The cost of materials came in second, with 13 percent of respondents citing it as their top concern.
In 2005, an increasing number of small businesses noted in the quarterly poll that they were passing on the higher energy and fuel costs. In early 2005, 64 percent passed on those costs; by the end of the year, 85 percent did so.
Small business owners began listing energy and fuel costs as one of their main concerns earlier this year, according to International Profit Associates. “Unquestionably, the most significant trends are those related to the impact of rising fuel and energy costs, regardless if the cause is from actions in the Middle East or from supplier problems at home,” commented Gregg Steinberg, president of International Profit Associates, in a statement.
Notably, the consulting company’s Small Business Confidence Index has declined this year. The index, which gauges expectations about the overall economy, revenue growth, and hiring with a view toward the next 12 months, is at 39.3, a significant decline from 52, the index’s level in the beginning of 2006. In early 2005, the index stood at 55.