Fiserv Inc. has released its May 2025 Small Business Index, revealing a picture of resilience despite economic uncertainty and changing consumer habits. The index remained steady at 151, with small businesses posting solid year-over-year sales growth of 3.3% and a 3.8% increase in transactions.
Month-over-month, sales inched up 0.2%, but transactions fell 2.7%, the largest drop in consumer foot traffic since early 2023. Meanwhile, the average purchase size rose 2.9%, suggesting shoppers are spending more per visit even as they visit less frequently.
“The continued shift toward essential spending is now a defining trend-growing at double the rate of discretionary purchases as consumers are more intentional with their spending,” said Prasanna Dhore, Chief Data Officer of Fiserv.
The shift is visible in sector performance, services surged 3.9% year-over-year, outpacing goods at 1.9%. Monthly, services grew slightly while goods declined, reflecting a preference for experiences and necessities over material items. Transportation, warehousing, manufacturing and professional services all showed strong momentum.
Restaurants, despite a 5.6% dip in foot traffic, managed modest sales growth of 1.8% year-over-year and 0.6% month-over-month, with full-service venues feeling the biggest pinch.
Retailers saw modest yearly sales gains of 0.9%, though average spend per visit fell nearly 2%, highlighting deal-seeking behavior amid inflation. Food, beverage and clothing retailers led growth, while gasoline stations and health stores lagged.
Regionally, 30 states reported sales growth compared to April, with New Mexico (+5.9%), Maryland (+3.2%) and Rhode Island (+3.1%) leading the charge. Washington (+13.3%), South Carolina (+11.3%) and Maryland (+10.1%) showed the strongest yearly gains.
Among major cities, San Francisco (+10.0%) and Atlanta (+9.5 %) stood out for year-over-year growth, while Dallas and Chicago led month-over-month gains, signaling healthy urban market momentum.
Overall, the data reveals small businesses adapting smartly, focusing on essentials and services, to navigate a cautious but steady economic landscape.
For Funds Society, Madrid