For the past few years, professional snow and ice management contractors have been adapting to an uncertain business climate. Sure, winter conditions directly impact contractor profitability. However, other economic-based factors have taken priority in their strategic outlooks.
A 2022 study conducted by the National Federation of Independent Business (NFIB) identified the average small-business owner’s top issues. To no surprise, the research found you are generally pessimistic about the state of the economy. In fact, the share of owners expecting business conditions to get better during the remainder of 2022 reached the lowest level in the survey’s nearly half-century history.
Here are some of the issues keeping you awake at night:
Labor. Your people, according to research conducted by Deloitte, account for 50% to 60% of your total business cost. U.S. labor costs increased 4% since last year, with 46% of owners raising employee pay, and 27% planning to do so in the next three months, according to the NFIB study. The study also found among owners who saw lower profits, about 11% blamed labor costs.
Taxes & Government Regulation. High taxes incur financial costs, including administrative costs. According to the NFIB, 77% of small-business owners find federal business income taxes the most burdensome. Next is payroll tax, with 69% of survey respondents citing it as burdensome, followed by state and local taxes (66%), property tax (63%), and unemployment tax (55%).
The government is increasing regulations for small businesses, as well. These mandates vary across industries and states and can apply to many parts of your operations. Examples of operational rules include requirements for tax codes, environmental regulations, and labor laws for workplace health and safety.
Labor Quality. More than half (52%) of small-business owners believe it has gotten more difficult to secure quality labor, according to a 2022 CNBC survey. But as you know, finding quality labor is only one part of the problem. Keeping qualified employees has become a point of concern, as well. Small business owners are often ill equipped to manage HR chores, therefore onboarding and retention activities suffer.
Inflation. Since September 2021, increasing inflationary pressure is most (84%) small business owners’ primary challenge, according to a 2022 Goldman Sachs survey. As you have most likely noticed from your own financials, inflation shrinks profit margins and increases the cost of raw materials or services, which leads businesses to hike prices. And as supply chain and pandemic-era challenges persist, small-business owners are pessimistic about inflation relief.
In the following stories, Snow Magazine insiders and experts aim to address many of these concerns, provide perspective, and equip you with the tools to better prepare for the obstacles you will address heading into this winter and the coming year. We might not have all the answers, but we can provide you with some better footing as you begin down that road to financial success. – Mike Zawacki, editor
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