4 strategies for local businesses navigating economic uncertainty
Every small business in the United States has a story of survival—especially those that endured through the pandemic. Millers All Day, a brunch restaurant in Charleston, South Carolina, lost more than 70% of its staff in 2020, only to rebuild its workplace from scratch and come back stronger.
“The pandemic was a life change for a lot of people,” Millers All Day co-owner Nate Thurston said. “[Many business owners] had to step back and make different decisions and realize that after this life-changing event, I’m going to make a change.”
Today, the ability to pivot amid uncertainty remains more important than ever. According to an ongoing survey from the National Federation of Small Business, small business owners were more uncertain in September 2024 than in the last 50 years, citing inflation and labor shortages as major concerns.
Nate—who expanded Millers All Day to a second location in 2022—reflects on strategies that helped him build a more resilient business model. Read on for his tips for navigating inflation, staffing, and other challenges during periods of economic uncertainty.
1. Cover gaps, but don’t become part of the daily machine
Today, staffing is a challenge for businesses across industries. One third of the country’s small business owners—11.3 million people—say they can’t find employees to do the work they need, according to a 2023 study. As the business owner, it may be tempting to jump in and fill those gaps in employment yourself, but Nate cautions against making this a permanent solution.
“It’s very advantageous if you have an owner [who can fill an empty role]. But if it happens frequently, and you’re doing it two or three times a week, then you become a working component of the machine, and you can’t step back and assess its performance,” Nate said. “I think it’s very valuable for a business to have an exterior viewpoint to look at the finished product.”
Nate recalled when he reopened Millers All Day after lockdown—missing 70% of his staff—and stepped back into the role of executive chef. “It was a great experience for me to get as deep into the businesses as I could but then realize that’s not sustainable for our growth [and our goal of] having multiple locations in the area,” he said. “I could not expand if I got my sleeves rolled up making donuts every day, even though I loved it.”
2. To retain employees, offer a compelling benefits package
Hospitality has some of the highest turnover rates, but retention is a challenge for all small businesses. “A lot of times, people have a server or barista position in college and eventually say, ‘Hey, I need to go get a real job once I’ve graduated,’” Nate said. “So what we’ve tried to do [at Millers All Day] is embrace that we have real jobs in our organization. You can have insurance, you can have benefits, you can have a healthy work-life balance.”
Even in a tough economy, Millers All Day has boosted retention by providing competitive wages and benefits like health insurance and a 401(k) retirement savings plan. “Some of the broken aspects of this hospitality culture—which has a reputation of being long hours and underpaid, underserved—we’ve tried to fix… in this particular restaurant,” Nate said.
Conversely, Nate said the pandemic—and the subsequent reckoning around labor—helped him slow down and make necessary changes to his restaurant’s culture. “We had to step back afterwards and say: ‘What’s broken about this environment? Why have so many people left?’ In that journey, I think a lot of businesses had to realize that the culture behind the scenes was unacceptable, and we had to start focusing on [improving] work conditions.”
Pro tip: Check out Indeed’s business guides on shopping for a health insurance plan and setting up a 401(k) for your employees.
3. Consult your target audience on pricing and product changes
Inflation is also a concern for small businesses in the current economy. Beginning in 2022, Yelp data showed that consumers are increasingly feeling the impact of inflation—and they’re letting businesses know in the reviews, citing high prices and “shrinkflation” (when a business reduces the size or quality of a product or service without changing the price).
While Nate is not opposed to raising prices to combat inflation, he also urges business owners to consult their target audience when making changes to product or service offerings. You can’t do one without the other, he said: “You have to adjust your price points to protect the performance of the business. Then you have to identify who appreciates your product and target that particular market.”
Take the restaurant’s famous cinnamon rolls, for example. Nate had a hunch the business was losing out on takeout orders, so he made the rolls 20% bigger to improve the quality for customers ordering to-go. “That increase is the exact opposite of shrinkflation,” he said. “We’re not trying to reduce the quality of the product so we can make more money on it—we’re increasing the size of it so the experience is better for the guest.”
Finally, Nate monitored the restaurant’s Yelp reviews to confirm this change was well-received—and sure enough, two Yelp Elites mentioned the “must-try” cinnamon rolls in October 2024. “My goal is to see those changes show up in the review format too, to verify that the hard work that we put into it is being appreciated and enables [our target audience] and motivates them to keep going on this journey with us,” he said.
4. Keep yourself accountable with Yelp reviews
When your business falls on hard times, it may be all you can do to continue operating as usual. And if you’re one of the 42% of small business owners who say they are experiencing burnout, you may not want to open yourself up to public feedback—and potential criticism—by reading reviews.
However, Nate said this is actually the best time for business owners to seek out input: “When [businesses] stop acknowledging public feedback… they start losing customers. Then there’s erosion, and their staff start leaving because they’re not as busy as they were. So although we don’t agree with every review, we read them every week.”
To make it easier to apply customer feedback, Nate and his management team have a meeting where they print out every review from the last 10 days and identify areas for improvement. His general rule of thumb? “You have to look for trends… If you can easily show [your team]: ‘Hey, there’s an issue here. Three people have complained about it,’ that’s kind of a no-brainer.”
Did you know? It’s not just business owners fighting to keep local businesses alive—reviewers like Yelp user Dave B. say they are motivated primarily by the desire to help businesses like Millers All Day. Read more insights from the mind of a Yelp reviewer.
I’m really invested in… [keeping] restaurant culture alive. It’s harder now than ever, with increased competition, wage pressure, food prices, shortages of labor, all the stuff [small business owners] face on a day-in, day-out basis. As someone who likes to consume local resources, supporting them is a priority for me.
—Yelp user Dave B.
These lessons come from an episode of Behind the Review, Yelp & Entrepreneur Media’s weekly podcast. Listen below to hear from Nate and Dave, or visit the show homepage to learn about the show and find more episodes.