The overall success of the small to mid-sized business (SMB) market remains pivotal to the full economic recovery.

Since November 2009, the Data Services Division of Capital Access Network Inc. has released a quarterly Small Business Credit Sales (SBCS) Report that highlights credit and signature debit card sales trends within the SMB market.

The report looks at the SMB landscape, excluding data from large retailers, to provide a snapshot of the trends impacting Main Street rather than Wall Street.  

The Q2 2011 SBCS Report indicates the nation’s women-owned small businesses are experienced less of a year-over-year decline during the recession than men-owned small businesses.

Capital Access Network’s examination of thousands of small businesses show that Main Street businesses lost 3.4% of their card sales in Q2 2011, compared to the year-ago period, but that women-owned small businesses saw a decline of only 1.5% (compared to men-owned businesses which saw a 3.6% drop).

This is the first time the report examined year-ove-year card sales broken down by the gender of the business owner.

The Q2 2011 report also indicates that consumers appear to be spending more on their cards, but not at Main Street businesses. The data indicate that Main Street businesses began to lose share of the available consumer credit card float nationwide, reversing the trend of the last several quarters.

According to the Federal Reserve’s October 2011 consumer credit report, revolving consumer debt rose 1.5% in Q2 2011. Main Street card sales in April fell 5.3% and then again 1.5% in May. Many card processors and issuers have recently reported increased consumer credit card usage figures.  

Capital Access Network developed the quarterly SBCS Report to analyze the economic health of small businesses. According to the company, the report tracks and benchmarks small business card sales.

A summary of key findings of the Q2 report:

1. “Main Street” businesses saw their same store credit and signature debit card sales decline 3.4% in Q2 2011 from their Q2 2010 levels. The decline reflects the second straight quarter of accelerating declines for Main Street restaurants, retailers and service providers. In Q1 2011, their card sales dropped 3.1%.  

2. Main Street restaurants are faring better. For the third consecutive quarter, card sales at restaurants increased, although by a small amount.  Restaurants saw card sales rise 0.1% in Q2 2011.  In comparison, retail and service providers reported a 6.0% decline in Q2 2011.This marks the 17th consecutive quarter of decline for Main Street retail and service providers dating back to Q1 2007.

Consumers are choosing less expensive restaurants in which to use their cards.  “Fine Dining” establishments experienced a 4.4% decline in card sales in Q2 2011, while those with an average ticket size of less than $25 reported a 2.8% increase. Moderately priced restaurants reported essentially no changes in Q2 2011 (average ticket sizes between $25 to $50 decreased 0.5%, and those with average tickets between $50 and $100 were flat.)

3. In Q2 2011, three out of four MSA* categories continued to show declines in same store credit sales, and the fourth was essentially flat.  Card sales increased marginally (0.1%) in MSAs with populations between 100,000 and 249,999, the first positive report for that category since Q2 2008.

Consumers in the nation’s urban areas (MSA population of 250,000 to 999,999 and 1+ million) are slowing their card purchases more rapidly than other categories, with a decline of 4.2% and 3.7% respectively.  The 1+ million MSA has experienced the longest period of declining year-over-year card sales –15 consecutive quarters dating back to Q3 2007.

4. Women-owned businesses are faring better in card sales when compared to their male-owned counterparts.  While overall, Main Street businesses lost 3.4% of their card sales in Q2 2011 compared to Q2 2010, women-owned businesses saw an only 1.5% decline.  For the same period, male-owned businesses dropped 3.6% in card sales.  

Glenn Goldman is CEO at Capital Access Network.


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