American Express recently conducted a Small Business Recovery Research study and found some troubling results. Of the small businesses surveyed, 62% said that they may not be able to stay in business if consumer spending hasn’t recovered to pre-COVID levels by the end of 2020. Finding this to be unacceptable, and with over a 10-year history of supporting small businesses, American Express is stepping up to do their part to help with the recovery.
“American Express has backed small business owners through challenging times for decades, and we are standing for them today as many struggle to recover from the effects of the COVID-19 pandemic,” said Stephen J. Squeri, Chairman and CEO of American Express. “Small businesses are the lifeblood of our communities, and now is the time to join together and help them rebound from this global crisis, because their success is critical to job creation, strong economies and thriving neighborhoods.”
In an effort to keep small businesses from having to close, American Express has announced a commitment of $200 million to help jumpstart spending over the next several months. Additionally, they have announced a $10 million pledge over the next four years and a coalition and grant program that will help with recovery for Black-owned small businesses.
Small Business Credits
To help encourage customers to start spending again at small businesses, American Express will be rewarding eligible U.S. card members with $5 back after they spend $10 or more. Shopping at small businesses can happen online, curbside or in-store, and cardholders can receive this $5 credit up to ten times between now and September 20, 2020.
How to Participate
To begin earning credits, cardholders first need to enroll their eligible American Express card at ShopSmall.com. This needs to be done by July 26, 2020, and prior to making purchases at small businesses.
Once enrolled, you simply need to shop at an eligible U.S. small business and spend at least $10. The $5 credit will be automatically applied to your statement. Then repeat the process nine more times. That’s all there is to it.
To help consumers find eligible small businesses near them that are currently open for either in-store or online purchases, American Express has updated their Shop Small Map. The map now has a data-driven filter that allows businesses to easily update their hours and contact information.
Something important to note: small business purchases done through a larger hub, such as Etsy or Ebay, will not trigger the credit. The same goes for food delivery services including Uber Eats or GrubHub. The exception to this rule is any restaurant reservation made through AMEX partner Resy.com or the Resy app.
Black Owned Business Investment
American Express has a longstanding history of supporting women and minority-owned business. In a continuation of this support, they are building a coalition and pledging $10M over the next four years to provide grants to organizations that focus specifically on helping Black-owned businesses.
The coalition will be formed with the support of the U.S. Chamber of Commerce Foundation, and participating organizations will include the U.S. Black Chambers, the National Black Chamber of Commerce, the National Business League and Walker’s Legacy. The goal of the coalition will be to address the challenges that Black-owned small businesses face due to racial and social inequalities, and to help those small businesses with their recovery.
Small Business Recovery Research
To gather the information that helped American Express reach the decision to make these investments, a mix of small business owners and consumers were surveyed. The survey sample was asked about their general outlook, community support and spending prioritization. This is a summary of some of the responses.
Many Small Business Are Worried About Making It to 2021
- 62% of businesses say they need consumer spending to return or they may be out of business by the end of 2020
- 65% of business owners say having regular customers return during the COVID-19 recovery process would be the most helpful element to survival
- 23% of businesses have shifted primarily to e-commerce
- 19% of businesses have started takeout/pickup services
- Nearly 25% of owners have stopped paying themselves to stay open
- Restaurant and bar owners unanimously say their businesses will not survive if conditions stay the same
Neighborhood Pride and Small Business Support Is Strong
- 95% of consumers say they value the small businesses in their communities, beyond just the goods and services they provide
- 85% of consumers say their neighborhood small businesses make it feel like home
- 75% of consumers are already looking for ways to shop at small businesses and support their community
- 56% of small-business owners are happy to see their communities rallying to support them
Consumers Will Prioritize Small Businesses Spending
- 62% of consumers say that as businesses reopen, they will prioritize “shopping small”
- 80% of small businesses expect to see their customers come back as soon as they safely can
Although the current outlook appears somewhat bleak, we can take comfort in the fact that consumers are ready to support small businesses as much as they can. Community support for business is swelling and consumers intend to keep spending at small businesses as they continue to re-open.
In the meantime, American Express is doing its part to keep small businesses running. These investments and encouragement of cardholder spending will certainly help many small businesses and may even keep some open that would otherwise have had to close their doors for good.
The additional commitment by American Express to help support organizations assisting Black-owned businesses over the next four years is a step in the right direction. We hope to see this program continue and expand over the coming years as these businesses struggle to recover and finally find the equal footing that they deserve.