KANSAS CITY, Mo. — Birdie Hansen stumbled nose-first into her small business during a time when most businesses were standing still.
"It was just a little hobby that I was doing around when everyone was doing their sourdough starters," she said
Her pandemic project turned into Effing Candle Co. in Kansas City, where she and her husband make cozy candles with a big sense of humor.
It’s a business that’s been growing, despite the odds, but as many small businesses can relate, success hasn’t come easily.
"The cost of our materials have definitely gone up this year, our wax our fragrances. Shipping is more expensive. Labels have gone up. Like everything that we touch has gone up in price," she said.
What consumers are feeling in terms of inflation, small businesses feel too. Inflation right now is at 7.7% and, according to Deloitte, that’s reflected in the holiday spending outlook.
Holiday spending is expected to stay stagnant at $1,455 per household, but consumers plan to buy less gifts—nine compared to 16—and will pull back on non-gift spending by 12%.
While low-income earners plan on spending 25% more than last year, high-income earners will most likely spend 7% less.
"Every day was a teachable moment for the last two and a half years," said Larry Wigger, an associate professor of supply chain management at the University of Missouri Kansas City.
Wigger had a lot to talk about in his classroom lately. He says inflation has been made worse by the lack of labor and supply chain disruptions of both the pandemic and the war in Ukraine.
"Just when we thought we were gonna recover it, set everybody back again," he said.
Wigger says that it will most likely take big shifts in society until we get back to how things were before the pandemic, including growing interest in blue-collar jobs and figuring out long-term supply solutions. In the meantime, there are opportunities for businesses to get creative to weather the current climate.
"Rethinking how you source your stuff, being creative about your hiring, and really thinking through your job descriptions," he said.
Getting creative is exactly what Birdie has been doing at her candle company.
What has worked in her favor is making sure her products come in a variety of price points, offering big discounts on imperfect products, and online gifts with purchases and free shipping minimums to entice buyers. She also hopes consumers keep small businesses like hers in mind when deciding where to spend this holiday season as every dollar continues to mean so much.
"We are just the ones out here making a product that we love, for consumers that we love," she said.
