Two independent retailers reflect on Q4-2023 and what’s ahead in 2024

The fourth quarter of each year (October to December) is generally considered the most important quarter for retailers across the country, both large and small. The retail sector (NAICS 44-45) has a large share of small business jobs — over 1.5 million. According to the Intuit QuickBooks Small Business Index, which looked at an anonymized sample of QuickBooks small business payroll customer records. This sector was among the better-performing sectors in the US throughout Q4-2023 — but still ended the quarter with 3,300 fewer jobs (seasonally adjusted) than the previous quarter. Employment declined in October and November but ended the year with a small monthly increase of 0.08% in December.

Despite the headwinds from high inflation and increased household debt, the National Retail Federation predicted a strong 2023 holiday shopping season in early November. But for the smallest retail employers, Q4-2023 may not have lived up to those predictions. 

The ramifications of a disappointing peak season could follow small businesses into 2024, especially for small retailers who might depend on strong holiday sales for a large portion of their annual revenue. Both the February and March Small Business Index indicate that the disappointing season may have impacted the first quarter of the year for these small businesses, as small retailers lost 3,100 jobs in January and another 5,400 jobs in February. Overall, it seems small business retailers had a tougher holiday season than anticipated. 

To find out, we talked to two small, independent retailers about how their businesses fared in Q4-2023 and how they’re feeling about the year ahead. Dana Donofree owns AnaOno, a Philadelphia-based chest-inclusive intimates company committed to sustainability. In nearby Bernardsville, New Jersey, Alexandra Daras owns and runs The Pretty Pink Rooster, a specialty boutique “offering jewelry, gifts, accessories, and clothing all at an affordable price point.”

Both business owners say they met their revenue goals in Q4-2023, “but it was a tough year,” says Donofree. “The consumer sentiment continues to change and marketing continues to increase in cost… which is making it more and more difficult for smaller businesses to compete.”

Despite these challenges, Donofree says she was still able to hire and build her team in 2023 — and she has plans for continued growth in 2024. But for a small retailer, recruiting can be difficult. “Hiring is complicated,” she says. “Especially for small businesses that have limited access to perks and incentives. Balancing the workload needs and the employee wants continues to be a struggle.”

Beyond that, Donofree says the talent pool of employees who are available and interested is shrinking. “Many corporations are struggling to find good talent,” she says. “It’s getting exhausting to find employees who are committed to improving their professional development and are passionate about what they do.” She expects her hiring efforts to slow in 2024 “as we see the changes in the economy balance out.”

Daras, on the other hand, has no plans to hire anytime soon but is optimistic about growing her business in new ways. “A new year calls for a clean slate filled with abundant possibilities and new ways to serve my clients,” she says. When faced with a challenging economy, her tactic is to focus on the silver linings. “Adversity creates an opportunity for growth,” she says. “Instead of focusing on the bad… I sit back and review how my business is changing and growing. I ask myself, ‘How can I serve my clients in different ways? How can I be of help to others?’” When we asked if she thinks 2024 will be a better year for her business, her response was a resounding “Yes!”

“Things are definitely changing for the better,” she says. “People are out shopping and supporting small businesses more than ever… Small businesses are the backbone of America. Small businesses help our communities, our schools, and we truly care about our customers. I know 2024 is going to be the best year yet!”

Donofree isn’t feeling quite so optimistic. When she looks ahead into 2024, she’s worried she’ll see “more of the same.” “With continued economic uncertainty,” she says, “I worry that 2024 may have deeper and more complicated issues.”

But when the going gets tough, the tough get going — and these small business owners are prepared to weather the storm. As the world continues to adapt to this new normal, Donofree looks forward to “seeing city centers recover and re-engage with our local communities,” she says. And Daras is excited to celebrate 10 years of The Pretty Pink Rooster in October. “I feel truly blessed to be able to serve my community for almost a decade,” she says.