CLEVELAND — The U.S. Bureau of Labor Statistics will be releasing its newest inflation data Tuesday, and many experts anticipate the Consumer Price Index will show a slowdown in price increases in the month of August. Although that would be viewed as welcome news after inflation set new records over the summer, the higher costs of running their small businesses have many owners settling in for the long haul.
The surging inflation rate over the past several months has been fueled by substantial increases to food and energy costs, both of which have been felt by Nick Semertsidis, the owner of Gus’s Old Brooklyn, a longtime restaurant in Cleveland’s Old Brooklyn neighborhood. What started as small increases for items like eggs, potatoes and milk, have in some cases turned into triple-digit increases.
Semertsidis said a 50 lbs. bag of potatoes cost him $14 to $18 at one time. However, that same bag now costs well over $40. The same has held true for eggs — a staple in his all-day breakfast offering — which are now more than $40 per case.Small businesses in need of capital to grow or re-tool their businesses are also feeling the bind. Consecutive increases to interest rates have made borrowing substantially more expensive. Consumers aren’t immune either.
Business Management 101. Every business owner should always be prepared for economic fluctuation. Operational expenses are always to be factored in for the potential worst of each fiscal year. If they didn’t already do this, their business could already be on the road to failure.
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