Alignable’s July Rent Report is being released right now, based on a poll that concluded this morning, conducted among 3,553 small business owners.
It shows that rent struggles are severe for several small business sectors, including transportation (trucking companies & car services), restaurants, retail shops, and beauty salons. What’s the cause according to SMBs? Rent hikes, labor costs/the ongoing labor shortage, the high price of gas, and reduced consumer spending are all combining to create economic instability.
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Restaurants Couldn't Pay Rent In July
Here are some quick highlights:
- The recovery rate for small businesses is at an all-time low of just 25%. That means 75% of small business owners have yet to earn the same monthly revenues they generated prior to COVID.
- 46% of SMBs say they're paying higher rent now than they did six months ago.
- 45% of restaurants (up 7% from June) & 44% of retailers (up 9% from June) couldn't afford their July rent.
- In fact, for restaurants & retailers, their rent delinquency rates in July were the highest they’ve been since the end of 2021.
- 40% of salons couldn’t make rent in July, up 15% from 25% in June.
- 48% of small businesses in transportation didn't have enough cash to pay July's rent.
- The overall rent delinquency rate for U.S. SMBs is 34%, just 1% shy of 2022's highest rate (35% in June).
- The situation is a bit worse in Canada, where the rate is 37%.
- 42% of SMBs in MA, 41% in NY, 40% in IL and 37% in MI weren’t able to fulfill their rent obligations in July.
