CardFlight Small Business Report

April 22, 2020

Another week of (mostly) positive news for small businesses: Sales up nearly 13% last week, number of transactions up 18%

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Introduction

Sales overall increased by nearly 13% last week, making it the best week for small businesses in the past month. Even with the increase, sales last week were still down 20% over the baseline week of March 2–8. However, the increase in week-over-week sales is an encouraging sign that small businesses are continuing to find ways to drive business forward and adapt to nationwide social distancing guidelines.

Key takeaways from this week’s report:

About this report

The CardFlight Small Business Impact Report is intended to provide insights into the impacts of coronavirus/COVID-19 on small businesses across the United States.

The report is based on analysis of a representative sample of over one million transactions processed from March 2 to April 19, 2020 by 60,000 small businesses who use CardFlight’s SwipeSimple software to accept credit and debit card payments. Learn more about our methodology.


Read on for more insights and analysis, including:

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Week-over-week changes

In this part of the report, we examine how coronavirus/COVID-19 is affecting small business sales by analyzing change in overall sales, number of transactions per business, and more.

Sales at small businesses up 12.7% last week

For the first time since we began the Small Business Impact Report, sales at small businesses increased by a double-digit percentage point last week.

Not only is it a noteworthy increase compared to the week prior, it also represents a reversal from the preceding 21 days, when sales were down an average of 27.5% compared to the baseline.

Transaction count up 17.9% week-over-week

Another positive sign of activity at small businesses is that the number of transactions were up nearly 18% — the first time we’ve seen double-digit percentage point growth in transaction count since the baseline week of March 2–8.

This suggests small businesses continue to find new ways to adapt and serve their customers during the coronavirus/COVID-19 crisis.

Average transaction size up 31% over baseline

The dollar amount of the average transaction remains up by more than 30% over the baseline week of March 2–8. This continues the trend of greater transaction sizes we’ve seen since the beginning of the Small Business Impact Report.

More small businesses were open and sales activity grew

The number of small businesses who were open for business has steadily decreased since the baseline week of March 2–8. Last week reversed that trend: 4.3% more businesses were open than the preceding week. This increase was driven in part by the retail category, which saw a 6% increase in open businesses compared to the previous week.

Of the small businesses that were open, the transaction count also increased by 13%. That makes last week the biggest increase in both active merchants and transactions per merchant we’ve seen since the beginning of the coronavirus/COVID-19 crisis.


Deep dive: Sales by business vertical

In this section of the CardFlight Small Business Impact Report, we take a closer look at small business performance by vertical (business category).

The three categories broadly define a range of small businesses:

  • Food and drink establishments: Includes bars and restaurants
  • Service providers: General contractors, healthcare providers, providers of professional services, and others
  • Retail: Businesses like sporting goods stores, specialty retail, home furnishings, automotive

We’ve been tracking the change in sales across three critical verticals since March 2: food and drink, retail, and services. Last week is the first week since the baseline in which all three categories registered positive week-over-week growth.


Next, we turn to change in transaction count by the same three business categories.

  • Transaction count at food and drink establishments grew 30% over the past three weeks
  • This growth was driven primarily by restaurants, which grew 39.5% week over week
  • The number of transactions at retail businesses increased 23.6% week over week
  • Number of transactions in the services category were up 14% last week, which was the strongest week-over-week growth since the baseline week.

Business verticals with the most momentum

The following business categories have seen two or more consecutive weeks of growth:

  • Specialty retail:  Number of transactions up 2.1% from last week
  • Repair shops: Transaction counts up 19.5% this past week, and 7.4% over the baseline week
  • Food and drink (excluding bars): Number of transactions in this category are up 10.6% this past week
  • Professional services: Number of transactions up 22% over March 23–29 and up 12.3% over last week


Business categories that are holding fairly steady

The number of transactions in these business categories are down compared to the baseline week, but by relatively modest amounts compared to their peer categories (measured by total percentage-point change of +/– 20%).

  • Onsite technical services: Number of transactions down 13.1% from baseline
  • Towing, trucking, and storage: Transaction count down 18% from baseline

Verticals with the biggest transaction-count decreases

The following business categories are down the most compared to the baseline week of March 2, 2020:

  • Clothing and apparel: Down 87% from baseline week
  • Clothing services: Down 71% over baseline week
  • Organizations: Down 71% from baseline week
  • Bars: Down 46.8% from baseline week
  • Entertainment and recreation: Down 67.1% from baseline week
  • Arts and creative goods: Down 72.9% over baseline
  • Salons and barbershops: Down 89% compared to baseline week
  • Healthcare: Down 54% from baseline week

Change in sales by urban density

Now let’s see how urban density affects the change in sales due to coronavirus/COVID-19. We break down urban density into four buckets:

  • Large cities: Metropolitan areas with a population of 5 million and above
  • Medium cities: Populations of 1-5 million people
  • Small cities: Urban areas with fewer than 1 million people
  • Rural areas: All other areas

Over the previous week, rural areas continued to be the least impacted by the effects of COVID-19, down just 9% from the baseline after a 19.8% increase in sales last week. Although urban areas are still at least 14% below the baseline, 91% of the overall increase in sales last week came from these areas.

Credit card payments via invoices continue to grow

One way the businesses in our sample are adapting to the impact of coronavirus/COVID-19 and the social distancing guidelines that accompany it are by an increased reliance on invoices — which don’t require physical contact to accept secure credit card payments. Payments via invoices are up by nearly 95% since the baseline week of March 2–8, 2020.



Thanks for reading the CardFlight Small Business Impact Report

Do you have questions, feedback, or press inquiries? Contact us.

You may also view past editions of the CardFlight Small Business Impact Report.

More about our methodology

To create this report, we analyzed a representative sample of millions of transactions processed from March 2 to April 19, 2020, by:

  • 60,000 small businesses 
  • in all 50 states 
  • using CardFlight’s SwipeSimple software to accept credit and debit card payments

This report can be useful in understanding the impact of COVID-19 on small businesses at a hyper-local perspective and across the US. It is updated on a regular basis tracking specific indicators including: shifts in consumer spending among local businesses; impacts across different industries, and across cities and states. 

The SwipeSimple small business owner 

The typical SwipeSimple merchant has one to ten employees and less than five locations or mobile service points. The average active merchant represented in this data set processes approximately $130,000 in credit/debit card payments annually. The merchants are a mix of professional and personal service providers, specialty retail establishments, and food and drink purveyors.

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