Small Firms Raising Prices

A recent survey finds higher costs and weaker sales are putting inflationary pressure on small businesses.

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More small-business owners raised selling prices last month to offset higher operating costs and weaker sales, the National Federation of Independent Business reported this week.

In a survey of the Washington-based advocacy group's members, 27 percent reported higher average selling prices in December, up from 24 percent in November. As many as 33 percent of small retail businesses reported raising prices, the survey found.

At the same time, the number of owners expecting real sales gains dropped two points to a net six percent. Of the 37 percent of small businesses reporting lower earnings, nearly half cited weaker sales. Others blamed higher material and labor costs.

"The historic relationship between inflation and the percent of owners reporting higher prices suggests that inflation will be showing some new, unwanted viability," William Dunkelberg, the group's chief economist, said in a statement. 

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