Payment and financial services technology provider Fiserv, Inc. has published the Fiserv Small Business Index for February 2025, with the seasonally adjusted Index holding steady at 147, unchanged from January. While total spending growth was nearly flat compared to January, sector-level trends showed consumers shifting more spend to retailers and restaurants in February and spending less at service-based businesses.
“Consumer spending continued to show resiliency in February, resulting in a second consecutive month of small business sales growth to start 2025,” said Prasanna Dhore, chief data officer, Fiserv, in a news release. “Notably, Restaurants, Furniture, Auto Parts, Clothing and Health Care all saw growth during the month.”
On a year-over-year basis, small business sales (+2.1%) and total transactions (+4.0%) showed healthy growth, according to the index. Month-over-month sales (+0.1%) and transactions (+1.6%) also grew.
Year-to-date, combined sales growth for January and February is 3.5%, according to the index, which is about 1.5 percentage points less than sales growth from the same two-month period in 2024. The slowing growth is the result of lower average ticket size, while transaction growth remains steady.
February Retail Demand Remains Strong
Consumer spending at small business retail remained strong with sales (+1.6%) and transactions (+1.2%) growing year over year, according to the index. Average ticket sizes (+0.4%) also grew, marking the first month since January 2023 that retail tickets have shown a year-over-year increase. Retail sales growth year over year was led by General Merchandise (+7.3%), Clothing (+3.7%) and Sporting Goods/Miscellaneous Retailers (+3.6%).
On a monthly basis, small business retail sales (+0.9%) grew and transaction growth was unchanged; average ticket sizes also increased (+0.8%). The most noticeable acceleration in sales growth came from Motor Vehicle and Parts Dealers (+3.1%) and Furniture, Home Furnishings and Electronics (+5.0%), according to the index. Consumers slowed their pace of spending in Grocery, Health and Personal Care, and Gas.
Restaurants Grow Compared to January
Consumer spending at small business restaurants declined (-2.4%) year over year despite transactions (or foot traffic) growing (+5.9%), according to the index. These annualized sales declines despite foot traffic growing reflect the ongoing trend of consumers trading down for lower-cost options when dining out.
On a month-over-month basis, restaurants experienced a welcomed bounce, according to the index, growing both total sales (+2.3%) and transactions (+3.9%). Similar to the annual trend, average ticket sizes declined (-1.6%) month over month.
Services Growth Slows
As consumers shifted more of their dollars to restaurants and retailers in February, service-oriented spending showed signs of slowing, according to the index, growing just +2.3% year over year and declining (-0.2%) month over month.
On an annual basis, the fastest-growing service categories were Professional Services (+8.7%), Religious, Civic and Professional Organizations (+7.0%), and Truck Transportation (+7.0%). Sectors seeing the largest sales decline were Equipment Manufacturing (-9.3%), Rental and Leasing Services (-5.9%), and Transit and Ground Passenger Transportation (-5.2%), according to the index.
Compared to January 2025, Hospitals (+1.8%), Personal and Laundry Services (+1.6%), Ambulatory Health Care Services (+1.5%) and Educational Services (+0.7%), saw the most growth. Sales declined most in Information Services (-2.6%) and Administrative Services (-2.3%).
Regional February Trends
- States showing the most year-over-year sales growth were North Dakota (+11.8%), Georgia (+10.6%), South Carolina (+8.6%), Minnesota (+7.0%) and Virginia (+6.2%), according to the index. The strongest-performing states month over month were North Dakota (+8.8%), Louisiana (+5.7%), Texas (+4.3%), Indiana (+4.0%) and Alabama (+3.6%).
- Large cities showing the most year-over-year sales growth were Atlanta (+14.4%) and Miami (+5.3%); conversely, the New York metro area saw sales decline (-5.7%) year over year. On a monthly basis, sales growth was strongest in Dallas (+4.6%), Atlanta (+3.2%) and Philadelphia (+1.2%).
