Fiserv Small Business Index Inches Upward in April
Consumer Caution and Reduced Discretionary Spending Is Impacting Main Street
The Fiserv Small Business Index for April 2025 rose by 1 point to 151, indicating a slight improvement in small business sales compared to March. The index is based on aggregated point-of-sale transaction data from about 2 million U.S. small businesses and provides a timely and reliable measure of small business performance.
Here’s a top-level summary of the findings:
Year-over-year sales increased by 3.2% and transactions by 6.9%.
Month-over-month, sales grew 0.4% and transactions 0.3%.
Inflation contributed 2.4% to sales growth in April.
The current small business trend is being driven by consumers prioritizing essentials like healthcare and groceries, while cutting back on discretionary spending such as travel and certain retail categories. This shift reflects increased budget consciousness amid market uncertainties.
Sector Highlights
Services continued to outperform goods, with Professional Services (+5.0%) and Ambulatory Health Care (+4.2%) leading gains.
Accommodation (-5.0%) and Transit/Transportation (-1.9%) saw declines.
Ground Transportation, Insurance, and Rental & Leasing showed the fastest monthly growth.
Dining Out: Restaurant sales saw modest annual growth (+1.8%), but average ticket sizes dropped sharply (-7.8%) even as the number of transactions rose (+9.6%), indicating consumers are spending less per visit.
Retail: Retail sales grew slowly year-over-year (+2.2%), led by Grocery (+7.0%), Clothing (+5.3%), and Building Materials/Garden Supply (+4.6%). Gasoline stations and health/personal care retailers declined.
Key Takeaway
While small business sales improved in April, the data shows consumers are increasingly cautious. They are focusing on essentials and reducing discretionary spending, especially in categories like dining out and certain retail sectors. Credit professionals would be wise to identify customers in the industry sectors being affected by this trend and implement appropriate risk mitigation tactics.