Business Notes
Happy July, Friends. I spent the weekend celebrating with family and friends at our home in Vermont, and although it was a blissful, much needed break, now it is a Tuesday night, and life continues to happen.
Let’s get into it.
What is Up?
As someone who runs two small businesses, one service based, the other a brick-and-mortar retail, the last several months has been anxiety inducing – shifting tariff policies, questions about interest rates, and the looming threat of inflation. All this plus the psychological effect on consumer behaviour and spending that translates into economic uncertainty in 2025 is a real issue that small businesses and nonprofits are attempting to navigate, and navigate on our own. The importance of strategic business decisions is more critical than ever, but where do we start?
Looking through articles and data from the last week, the most recent U.S. tariff announcements will effectively raise import costs between 12% to 22%, putting the pressure on local and global supply chains, which in turn puts the pressure on small businesses and their pricing strategies. Plus inflation is inching past (about 2.5% to 2.8%) what the Federal Reserve considers “normal” at 2%. Yet, as we look at the most recent data on consumer spending trends, we see a fairly healthy outlook with spending up to just under 4% from last year. What the heck?!?
What is the economic impact on my business or nonprofit? What does all of this mean for small teams with limited, (or shrinking) resources? What does it mean for my margins? ANSWER: It means building in as much flexibility as possible as funding cycles tighten (for NPO) and consumer spending behavior remains unpredictable. It means planning. P L A N N I N G.
For me, a significant part of being successful has been my ability to strategize and plan for uncertainty. Cash flow strategies and scenario planning creates clarity around the things that I can control in the midst of all the things that I cannot. Not because I believe the plan will “save” me, but because by going through the process of visualizing challenging or crisis scenarios, I can create flexibility and a plan to pivot through crisis. You might be thinking, OK. Great! What does that actually mean, in real life?
Actionable Strategies
Cash Flow Strategies:
When COVID-19 hit, and everything shut down in March 2020, I found myself working one-on-one with small businesses who were faced with unexpected shut downs, layoffs, loss of income, and an uncertain future. All things that they had NEVER had to contend with en masse – the fear and uncertainty was palpable and understandable. As is my nature, I encouraged my clients to pivot towards what they knew – and inevitability it was their numbers. We looked at their revenues from the past year, their fixed and variable expenses, and what we predicted would change in the shadow of a global pandemic. Instead of 12 month cash flow scenarios, we narrowed it down to 60 day, 30 day, and in several cases, weekly cash flow projections depending on their business and their circumstances. From that, I supported clients as they made decisions about cash reserves, layoffs, loans, and in some cases, shutting down entirely. Most of it was heartbreaking, and none of it was easy, but in every single case, my clients had a strategy to move forward and make decisions with good information and as much as control as they could exert given the circumstances.
Today, we are faced with the real possibility of long-term economic downturn and as small business owners, we are left mostly to our own devices to figure this out. Yet, we still have tools that we can turn to: cash flow projections and financial modeling.
Business Scenario Planning:
Even as we navigate cash flow during these uncertain times, it is important for businesses and nonprofits to also consider their “business plan”. Not the thick, dusty, unused document sitting in your files that only gets pulled out for a banker or board member, but your working plan that looks more broadly at your customers (are they being affected by the current economic conditions?), your staffing (do we have the right people in the right seats for an uncertain future?), and your identified revenue sources (what pain points are they facing? is your pricing strategy still relevant?). Balancing the reality of inflation pressure (real or imagined) requires your business and organization to be flexible and adaptable – particularly when you are service or product based.
Marketing, Pricing, and Revenue Growth
Yep, this is still a possibility. Although the world may seem like Hell-in-a-Handbasket, the truth is that there are still customers, clients, and companies who want to invest in your product, your service, and your mission. Honing in on your messaging, your strategies, and your “Why” during times like this can be a huge advantage to not only clarifying your mission, energizing you and your time during uncertain times, but also giving your current and potential customers a reason to invest their resources in you.
Outside Consulting
Wait. I take it back. As a matter of fact, NO – you do not need to navigate this alone. Whether it is me, or another consultant, or even your local Small Business Development Center (SBCD), no business or organization should navigate the uncertainty of our future alone. There is an immense amount of expertise out there, and having a set of eyes on your numbers, your plan, and your operations can be a huge benefit both short term and long term – whether it brings you clarity, peace of mind, or an “a-ha!” moment.
This is where I explain how my services can help – whether it is through a business planning guide, working with your team to create clarity around your business strategy, or just meeting you where you are with a “right-sized” strategy. Check out my free resources, or book at call and we can talk things through. No pressure, no sales pitch, and no gimmicks.
Citations and Summarizations
Tariffs Are Squeezing Small Businesses
60% of businesses surveyed by KPMG have already seen a decline in profit margins due to tariffs.
▸ KPMG Study
97% of U.S. importers are small businesses, and many are facing higher input costs due to increased tariffs.
▸ U.S. Chamber of Commerce
Tariffs could raise U.S. factory costs by 2–4.5%, disproportionately affecting smaller firms.
▸ AP News
Some small businesses report cost increases of up to 34% in their supply chain, threatening margins.
▸ Business Insider
Hopeful, but Pressured
95% of small business owners are still optimistic, but 73% say they’re under significant operational pressure.
▸ The Guardian
72% of small businesses are planning to grow in 2025, even while managing risks.
▸ Detroit Chamber / US Chamber Data
Inflation & Interest Rates Add to the Strain
- Inflation is tracking at 2.7% (June 2025)—lower than last year, but still affecting business purchasing power.
▸ U.S. Treasury - Interest rates are holding at restrictive levels, which could limit near-term investment or hiring.
▸ Deloitte Economic Forecast
Macro Risks from Trade Policy
Effective U.S. tariff rates could rise to 22.5%, the highest since 1909, if proposed increases go through.
▸ Yale Budget Lab
U.S. trade policies are affecting exporters globally—Brazilian small businesses are already reporting hardship.
▸ AP News International
Corvid Collective Consulting 