Small businesses in the Bay Area express challenges as hope diminishes

PartyTime Machines, a rental company in Santa Clara, is feeling the pinch of inflation as raw material costs soar, squeezing profit margins and forcing customers to cut back on spending. President and CEO Aimbrell Shanks, who purchased the company in 2015, is facing a 25% increase in raw material costs, with some items like sugar for cotton candy machines jumping by 30% to 40%.

The impact of rising costs is evident as customers opt for the bare minimum rentals, with some even bringing their own supplies to use with the rented machines. Shanks revealed that a job that would have brought in $5,000 in the past now only yields $800 in revenue.

The struggle is not unique to PartyTime Machines, as small business owners across the Bay Area are grappling with the same challenges. A new report from Bank of America shows that small business owners’ confidence in the economy has dipped, with inflation being the top concern.

Despite the tough economic climate, some business owners remain optimistic. Abbas Attarwala, co-founder of fragrance company Nemat International, shared that the company has been consistently growing and has even added new employees. While inflation has impacted their business, they have managed to mitigate costs by buying supplies in bulk and investing in new processing machines.

As small businesses navigate the uncertainties brought on by inflation and rising costs, the hope remains that they will weather the storm and emerge stronger on the other side.