Even a pop in sales from Small Business Saturday would not allay small
companies' concerns about looming tax hikes and continued uncertainty about
their operating climate, local business owners say.
Many in the Pittsburgh region are worried about possible tax increases in
2013, the health care cost burden from the Affordable Care Act and drastic
federal spending cuts tied to the "fiscal cliff."
"Taxes are definitely a concern. It's going to affect all businesses,"
said Rick Murray of Rusmur Floors Carpet One Floor & Home in Bridgeville.
"When expenses go up, you have to find ways to reduce expenses. That's
the tough part," said Murray, whose company has five showroom locations in the
region and about 150 employees.
Now in its third year, Small Business Saturday is sponsored by American
Express Co. and FedEx Corp., whose FedEx Ground unit is based in Moon
Township. The small business day in 2011 drew more than 100 million shoppers
to independent small businesses, according to American Express.
To support small businesses, FedEx gave away 40,000 Shop-Small American
Express gift cards worth $25 each via Facebook. FedEx also made available to
independent retailers posters promoting Small Business Saturday that could be
printed for free at FedEx Office Print & Ship Center locations.
This year, the average holiday shopper will spend an estimated $751 on
gifts, decorations and other holiday purchases, according to the National
Retail Federation. How much of that winds up in the pockets of small-business
owners is hard to estimate.
The NRF does not track sales specifically to small retailers but notes
that 95 percent of the nation's retailers are independent companies with one
location.
For many small businesses, holiday sales can represent nearly 20 percent
of annual sales, according to industry estimates.
The elections hardly changed the Republican/Democrat balance in the House
and Senate, "and there's so much divisiveness in Washington that we still have
no certainty at all," said Mark Shelleby, treasurer of Vista Metals Inc. in
McKeesport, which makes tungsten carbide forms for manufacturing consumer and
industrial products.
"The only certainty we do have is that to avoid the fiscal cliff,
Congress will impose higher taxes in one shape or another, which leaves you
with a flat order book," said Shelleby. He is also vice chairman of SMC
Business Councils, a Churchill-based trade group that represents about 1,500
Pennsylvania small businesses.
Under the fiscal cliff, the 2011 law aimed at balancing the federal
budget, more than $500 billion in tax increases and spending cuts would occur
in 2013, starting in January. That includes the expiration of the Bush tax
cuts on Dec. 31, which would bring higher federal income taxes and capital
gains taxes, higher estate taxes and a resumption of the federal payroll tax
that funds Social Security.
Shelleby worries that drastic federal spending cuts, especially a more
than 9 percent reduction in defense spending, will "trickle its way through
the economy" because it will particularly hurt manufacturers that supply
components for vehicles, aircraft and the like.
"Everything is on hold from a capital standpoint, and it will be on hold
until we get more clarity," said Shelleby of Vista Metals' plans. He added
that the company would also be "out of a hiring mode" for now.
Thomas Olson is a staff writer for Trib Total Media.
