ShopKeep study finds retail profits, confidence high

ShopKeep, a POS technology provider established in 2008 and based in New York City, released a new report Aug. 4, 2015, titled Small Business Index (SSBI). In-store sales data and results from 1,260 ShopKeep customers polled between June 13 and 27 formed the basis for the study.

ShopKeep's cloud-based POS platform for iPad cash registers includes inventory management tools and data analytics. Approximately 16,000 independent small to midsize businesses in the United States, Guam and Canada are using the solution, the company stated.

"The results from our merchant survey and same-store sales data report that small businesses are booming, demonstrated by the fourth consecutive quarter of increasing revenue and growth," said Norm Merritt, ShopKeep President and Chief Executive Officer.

A healthy dose of optimism

Merritt also noted that a majority of the independent business owners who participated in the SSBI are new business owners who share an optimistic vision of the future. Nearly 98 percent of ShopKeep merchants surveyed expressed cautious optimism in the U.S. economy and provided favorable business forecasts.

Other notable SSBI statistics include:

• 79 percent of business owners reported increased business revenue over the past six months.
• 39 percent believe that today's national economy is better off than it was one year ago.
• 69 percent plan to hire at least one additional employee over the next six months.
• 71 percent noted increased net profit during the second quarter of 2015.
• 92 percent said they expect to record increased revenue by the end of 2015
• 84 percent anticipate increased profits by the end of 2015

Also, a 23.1 percent increase in year-over-year revenue was noted across all categories. And in addition to the 69 percent who plan to hire at least one new employee, 12.5 percent plan to hire four or more new staff members by the end of 2015. This trend, combined with falling unemployment may improve the national unemployment rate, which is currently at 5.8 percent, ShopKeep pointed out.

Rising volumes, level pricing

Sixty-two percent of merchants surveyed have not increased retail prices in 2015 and attributed the growth in their businesses to increased sales and new customer acquisition. Seventy-two percent of respondents had no plans to raise prices for the remainder of the year, preferring to focus on such strategies as developing marketing campaigns, expanding product and service lines, and expanding operations and staff.

The report noted positive growth in same-store sales data for the second quarter when compared to the same period of the previous year. This growth was reflected across a range of business segments including quick service restaurants, restaurants and bars, and retail. The average cross-category growth rate of 23.1 percent in sales revenue reflects an 11 percent increase from the first quarter of 2015.

Technology and EMV

The approaching October 2015 liability shift deadline for implementing Europay, MasterCard and Visa (EMV) is prompting many small-business owners to consider upgrading their payment card processing systems. Many of these merchants understand they will bear full responsibility for any fraudulent payments transacted on non-EMV compliant equipment after Oct. 1, 2015.

Numerous reports with varying statistics on EMV merchant readiness have been circulating throughout the payments industry. SSBI findings indicate that 62 percent of ShopKeep's customers are prepared to implement EMV before the Oct. 1 fraud liability shift.

"When asked why they will be ready, small-business owners provided valuable insight, such as improved security, future-proofing their businesses, and already fully prepared with necessary hardware," the report stated. The report also noted the need to educate small-business owners on EMV security and best practices.

ShopKeep leadership anticipates the EMV transition will prompt merchants to explore other emerging technologies such as contactless and mobile payments. "Each quarter we monitor adoption trends of contactless payments, and this quarter, an impressive 82 percent of merchants agree that contactless payments will boost business, stating reasons such as increased customer convenience, speed and revenue," the report stated. More details can be found at www.shopkeep.com/wp-content/uploads/press/2015-ShopKeep-Q2-Business-Index.pdf .

Editorial Note:

Whether you want to upgrade your POS offerings, find a payment gateway partner, bone up on fintech regs or PCI requirements, find an upcoming trade show, read about faster payments, or discover the latest innovations in merchant acquiring, The Green Sheet is the resource for you. Since 1983, we've helped empower and connect payments professionals, starting with the merchant level salespeople who bring tailored payment acceptance and digital commerce tools, along with a host of other business services to merchants across the globe. The Green Sheet Inc. is also a proud affiliate of Bankcard Life, a premier community that provides industry-leading training and resources for payment professionals.

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