The Fiserv Small Business Index for May remained steady at 145, indicating stability in small business activities. Small business sales showed a 4.3% year-over-year increase in May, with a modest 0.2% month-over-month growth. Foot traffic also saw a 5.2% year-over-year rise, although there was a slight 0.5% decline compared to April.
Nationwide, small business retail spending stayed flat in May, with transactions seeing a 0.7% month-over-month increase. Food & beverage retailers experienced substantial spending expansion (+2.1%), while other sectors like clothing, sporting goods, and health/personal care also reported marginal gains over April.
On the other hand, spending in general merchandise, auto parts, building materials, and furniture declined in May, suggesting a restraint in discretionary spending by consumers.
Prasanna Dhore, Chief Data Officer at Fiserv, noted that consumer spending increased in May, but consumers are cautious about their discretionary purchases. There is a trend towards non-discretionary spending, with grocery stores seeing higher spending growth compared to restaurants.
Consumers are trying to strike a balance in food spending, allocating a significant portion of their budget to food purchases each month. Restaurant spending saw a 4.1% year-over-year increase, with a modest 0.6% growth from April. However, restaurant foot traffic decreased by 1.2% compared to April, as consumers preferred visits to food & beverage retailers, such as grocers, which saw an 8.4% year-over-year and 1.5% month-over-month increase in foot traffic.
