Small Business Sales Stabilize
February sales for small businesses remained stable, according to the latest Fiserv Small Business Index released on March 3. The data shows that higher ticket sizes successfully offset declines in foot traffic, which were largely driven by weather. Year-over-year sales saw a modest increase of 1.2%.
The stability in small business performance was most pronounced in the service sector, which saw sales grow even as restaurants experienced a decline due to slower foot traffic. Notably, subsectors like Health and Personal Care Retailers saw a 3.0% year-over-year sales boost, while Repair and Maintenance services also climbed 1.5%. While bad weather was a key factor in dampening in-person shopping, online retail sales surged, growing at the fastest pace recorded since April 2021. This highlights a critical pivot for service businesses on days when weather discourages travel; a robust digital presence can capture business through online bookings, virtual consultations, or digital content. The broader economic environment is showing a "K-shaped" dynamic, with spending growth being driven more by higher-income households. For a dual-service business in a tourism hub like Montego Bay, this suggests a strategy of offering premium, high-value packages for tourists and affluent locals, alongside value-driven deals to attract the broader community. Consumer spending trends for 2026 show a clear preference for necessary services and wellness over expensive discretionary goods. Spending on health, beauty, and self-care is a strong and growing category, with many consumers integrating wellness activities like group fitness into their social lives. Underneath the stable sales figures, the small business labor market showed renewed strength. U.S. small businesses added a net 105,700 jobs in February, a significant rebound and a substantial improvement from the 25,900 net hires in February 2025. This resilience comes as consumer confidence shows tentative signs of improvement. The Conference Board's Consumer Confidence Index rose for the third consecutive month to 91.2, suggesting a slightly more optimistic outlook from customers.
