Nevada small businesses feel inflation pain, one owner shuts down rather than raise prices
LAS VEGAS, Nev. (FOX5) - As small businesses continue to feel the pain of inflation, one beloved restaurant in Henderson is choosing to shut down rather than raise the prices for customers.
According to the Nevada Small Business Association, restaurants across Nevada have started to close amid this latest economic storm of rising costs and worker shortages.
“I‘m very proud that we managed to stay open through COVID-19. Now with inflation and not being able to find staff, it’s been a challenge for us,” said Gert Kvalsund, owner of Saga Pastry and Sandwich off St. Rose Parkway, who has struggled with shrinking hours amid employee shortages for months.
Kvalsund said the restaurant was the first Scandinavian eatery in the Las Vegas.
“There’s many ways to go. You can buy cheaper products, you can have smaller portions, or you can raise the prices. I don’t want to do any of that. I think quality should always stay the same,” he said. “Things were starting to look up when the restrictions went away. And then the next thing is just prices skyrocketing,” Kvalsund said.
“When it comes to prices, there’s only so much that people will pay for a sandwich and a waffle,” Kvalsund said.
“It is a perfect storm. We’re seeing it again and again,” said Randi Thompson of the Nevada Small Business Association, noting that small restaurants are especially vulnerable to inflation challenges. “Food is a third of your cost. labor is a third of your cost... so now you have to raise your rates, or you’re not going to remain in business,” she said.
The National Federation of Independent Business reports that 31% of small businesses are taking on debt. Organization SCORE reports that more than 54% of businesses raised costs, and 23% of workers asked for raises.
Thompson said the biggest impact is felt among communities where unique establishments may be lost for good.
“What makes our neighborhoods unique is our locally owned and operated businesses. And they’re the ones that are struggling the most,” Thompson said.
Saga will close Sunday. Kvalsund said there are hopes to reopen another location in September with cheaper rent.
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