The Federal Reserve Bank of Atlanta publishes a monthly report titled “Business Inflation Expectations” (BIE) that contains statistics from a survey of regional businesses’ views on various factors that impact profitability. These factors include unit costs, unit cost expectations, sales levels, pricing, profit margins, and other factors.
As described on the site:
“Approximately 300 panelists receive the survey each month. Panelists represent businesses of various sizes headquartered within the Sixth District, which encompasses Alabama, Florida, Georgia, and sections of Louisiana, Mississippi, and Tennessee. Panelists range from executives of large corporations to owner-operators of small businesses. The industry composition of the panel roughly reflects the makeup of the national economy. Nevertheless, survey responses are weighted by industry shares of national gross domestic product.”
An excerpt from the November 2022 BIE Survey dated November 16, 2022 (involving 158 firms responding):
- Inflation expectations: Firms’ year-ahead inflation expectations remain unchanged at 3.3 percent, on average.
- Current economic environment: Sales levels “compared to normal” remain unchanged. Firms’ profit margins “compared to normal” increased. Year-over-year unit cost growth remains relatively unchanged at 4.0 percent, on average.
- Quarterly question: Approximately 33 percent of firms expect both labor and nonlabor costs to have significant upward influence on prices. About 48 percent of firms expect sales levels to have little or no influence on prices over the next 12 months. Approximately 32 percent of firms expect margin adjustment to have moderate upward influence on prices over the next 12 months.
- Special question: Firms were asked about the impact of interest rate increases on their businesses. They were also asked about their views on a hypothetical interest rate increase. A breakdown of the results can be found in the special question section below.
RevSD, LLC offers the above commentary for informational purposes only, and does not necessarily agree with all (or any) of the views expressed by these outside parties.
ProfitabilityIssues.com is published by RevSD, LLC. RevSD, LLC is a management consulting firm and strategic advisory that focuses on the analysis of current and future business conditions, and given these conditions, offers corporations and businesses advice, strategies, and actionable methods on how to optimally increase revenues and profitability.