Small businesses are under pressure like never before. Rising costs, unpredictable policies, and supply chain disruptions are threatening the survival of many owners who are already stretched thin. Action is no longer optional – it’s essential to protect your business.

In July 2025, Revenued surveyed 131 small to midsized business (SMB) owners using the Business Card and Flex Line to understand how tariffs, inflation, labor shortages, and financing are affecting their day-to-day operations. The results underscore key trends concerning profit margins, supply chain developments, capital accessibility, and future outlook. Despite existing challenges, the outlook for the future remains largely positive. This indicates continued confidence and a strong belief in favorable future developments.

Let’s dig in.

Changes in tariffs are one of the most pressing challenges small businesses face. They are pushing up costs, disrupting supply chains, and forcing owners to make difficult decisions to protect already thin margins.

Revenued’s survey data reveals how widespread these effects have become:

• 67% of SMBs have been directly impacted by tariffs in the past 12 months.
• The most common effects include:
  • Higher costs for goods and materials
  • Delays in inventory and fulfillment
  • Forced supplier changes or supplier loss
• Only one-third of SMBs report being unaffected by tariffs.

Tariffs are not hitting all small businesses equally. Certain industries and regions are bearing the brunt of cost increases and supply chain disruptions

• Construction and manufacturing companies reported the highest exposure, with 78% citing significant cost increases on raw materials like copper, steel, and lumber
• Retail businesses, especially those relying on imported inventory, saw 71% reporting delayed shipments and supplier disruptions.
• Regionally, coastal states with stronger import dependency (e.g., California, New York, Florida) are experiencing the greatest impact: 72% of SMBs in these states report tariff-related delays, compared to 58% in inland states.
• SMBs dependent on a single foreign supplier are more likely to face margin erosion, with 83% of these businesses saying they have absorbed higher costs rather than pass them to customers.

What Owners Are Saying

Below are insights into how the impact of tariffs is currently being experienced across various industries. This data, drawn exclusively from businesses that participated in our July 2025 revenue survey, highlights which sectors are most significantly affected by present-day tariff policies, offering a snapshot of their direct and indirect financial pressures based on the responses we collected:

• Construction: 78% reported being directly affected by tariffs, with rising material costs as the top issue.
• Manufacturing (Medical Equipment, Automotive, Furniture): 74% cited 

  tariff-related cost pressures and inventory delays.

• Retail (Consumer Goods, Apparel/Toys, Wholesale): 68% noted profit margin reduction due to absorbing costs rather than passing them fully to customers.
• Service-Based (Professional Services, IT, Healthcare, Education): 41% reported indirect tariff impact through inflation-driven costs and vendor price hikes.

*These figures reflect trends observed across all surveyed businesses where complete data was available.

*These figures reflect trends observed across all surveyed businesses where complete data was available.

We can't keep raising prices without losing customers, but costs keep going up

- Retail Business Owner (Florida)

Labor shortages continue to be one of the most significant hurdles for small businesses. Owners are struggling to find qualified workers and, in many cases, cannot afford the rising costs of hiring and retaining employees.

Revenued’s survey data highlights the severity of the labor issue:

• 62% of SMBs report difficulty finding qualified workers
• 59% of businesses have raised wages in the last 12 months to compete for talent
• New minimum wage laws have significantly impacted 15% of SMBs and moderately affected another 23%
• Owners who cannot expand their teams are working longer hours themselves, limiting growth and adding stress
• 15% of SMBs surveyed said their labor and hiring challenges have worsened this quarter due to changes in US immigration policies

I'm back to working 80-hour weeks myself

- Retail Solutions Business Owner (Illinois)

• 64% said it has become harder to access credit from traditional banks in the past year, citing stricter lending standards and high rates
• 16% said accessing financing through a bank has not gotten harder for them, while the rest have not applied to a bank or use financing through other (non-bank) sources
• Anecdotally, several owners explicitly wrote that “interest rates are too high” and that they need lower rates or more aordable loans to grow

We've been denied by three banks this year

– Landscaping Business Owner (Georgia)

• 49% of SMBs have been denied a bank loan or line of credit in the past two years (see chart on page 13)
• 70% have used alternative financing products (e.g., revenue-based funding, merchant cash advances) in the last 12 months
• Nearly 47% report having no emergency reserves to cover cash flow disruptions

• Owners cite high interest rates and stricter lending standards as the biggest barriers to securing affordable capital

This lack of access to affordable capital is one of the most dangerous threats to small businesses today. Without funding, SMBs cannot invest in growth, weather unexpected costs, or stabilize operations when revenue slows.

• Construction and manufacturing businesses report the highest reliance on alternative funding, with 77% using revenue-based financing or merchant cash advances in the past year
• Service-based SMBs (e.g., restaurants, salons) are more likely to operate without emergency reserves, with 54% reporting they have less than one month of cash flow available 

The presented usage data for the Revenued Business Card and Flex Line is derived from an internal analytical review of the survey respondents' account activity. This internal examination sought to identify potential correlations between reported economic stressors and the utilization of Revenued's revenue-based financing solutions, and is provided solely for illustrative purposes.

• "Be more conservative with cash." Many owners recommend building larger financial cushions to handle unexpected costs
• "Focus on your core customers and team." Retaining loyal customers and employees has been critical to stability
• "Scale slowly and steadily." Avoid over-expansion until you are certain demand and capital are secure
• "Diversify suppliers and revenue streams." Reducing dependency on a single vendor or product line can protect against shocks

Plan for the worst and expect it to happen

– Retail Business Owner (Florida)

Despite these challenges, most small business owners remain confident about the next 12 months and are planning for growth.

• 88% of SMBs say they are confident about the next 12 months (see chart on page 16)
• 68% plan to invest in business growth through equipment purchases, expansion, or hiring
• 58% intend to hire additional staff, even though many still struggle to fill positions
• 4 in 5 admit they are only "somewhat prepared" for a potential recession, with limited cash buffers in place.

Business owners reveal a broadly optimistic outlook for the year ahead. Nearly all respondents expressed confidence in their businesses' financial prospects over the next 12 months – in fact, over 90% felt at least somewhat confident, with more than half describing themselves as very confident. This positive sentiment is translating into action: roughly 70% of surveyed owners plan to invest in expanding their business within the next six months. A strong majority also anticipate growth in their teams, as nearly 60% expect to hire additional staff in the coming year.

Alongside this optimism, business owners are showing prudent preparation for potential challenges. Over four out of five respondents feel they are at least somewhat prepared to weather a possible recession, demonstrating resilience and foresight. Additionally, just over half have built up an emergency cash reserve for their business, providing a cushion for the future. Overall, the Q3 survey indicates that small business owners remain confident and forward-looking, backing their optimism with concrete plans for growth and sensible safeguards for whatever comes next.