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 March 2022 BIE Survey dated March 16, 2022 (involving 183 firms responding):
- Inflation expectations: Firms’ year-ahead inflation expectations increased significantly to 3.8 percent, on average.
- Current economic environment: Both sales levels and profit margins “compared to normal” decreased over the month. Year-over-year unit cost growth is relatively unchanged at 4.1 percent, on average.
- Quarterly question: Firms’ long-term (per year, over the next five to 10 years) inflation expectations increased to 3.3 percent, on average.
- Special question: Firms were asked about their ability to pass cost increases through to their prices. They were then asked how the price of their primary good or service has changed over the last 12 months. Finally, they provided the expected rate of growth in their primary price over the next 12 months and the next five to 10 years. A breakdown of the results can be found in the special question section below.
The report also includes other questions and a variety of charts and tables depicting respondents’ answers.
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.