According to the NFIB, more small businesses fear inflation than the lack of business credit.
That’s a fairly rare phenomenon in the US because it’s usually funds for expansion that are the limiting factor in business expansion.
But when inflation is the worry, the question becomes not just “can we bring in more dollars?” but rather “after we bring in the dollars will we have have really made a profit after factoring in both expenses and the loss of buying power in those dollars?”
Big businesses with large cash reserves find themselves – in times of massive inflation – playing the money markets just to keep those reserves from becoming worthless… they are better able to turn their assets into other currencies that are not in freefall.
Small and home based businesses on the other hand have one resource bigger businesses don’t in theory – the ability to do face to face, value for value trading or barter. The problem with this is that it can generate tax liabilities that come back to haunt the participants because income tax and sales tax liabilities may be generated in these transactions. Scrupulous record keeping is involved.
Another wild card is in play in the quest for business profitability.
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