Rubber Gloves + Chicken Thighs

Written by CMG News Contributor, Doug Carleton

Book title? Country western song? Either one would be a winner, but it appeared in a sentence in a Wall Street Journal article on shortages of supplies, merchandise, parts, and so many of the things that the slowdowns and shutdowns have caused. A formerly multiple-location restaurant owner in Chicago had to close several of his restaurants and, in his remaining one, had to pay more for rubber gloves and chicken thighs. This story leads us to the subject of this blog – the breadth, size, and frequency of rising costs. Here are just a very few examples:

  • Laptops for gamers from a Taiwanese manufacturer are up from $900 to $950 – almost 10%.

  • HP raised printer prices by more than 20% in one year.

  • The rubber gloves and chicken thighs, as mentioned above.

  • Bike retailers who can’t get enough bikes or specialized parts when they need them

  • Pay raises being seen – especially for normally low-wage employees in many industries. The same restaurant owner having rubber glove and chicken thighs problems has to raise wages for kitchen workers to an almost unheard-of level of $18 to $20 an hour to get them and keep them.

The size of so many increases in the cost of physical products and wages is significant. There are plenty of much bigger items having large increases such as housing, used cars, gasoline, travel, and more. These increases and how fast they have happened are rapidly escalating fears of inflation and gotten way out in front of the Federal Reserve’s targets. If inflation does continue for longer than the Fed currently believes it will, it could lead to possible interest rate increases, among other things. Maybe not much, but a quarter of a point here, a 20% increase in the price of a printer there, higher gas prices, and other things could begin to put the brakes on the economic recovery.

Another thing that can happen that leads to increasing inflation is changes in consumer sentiment. If people think prices will continue to go up, they may buy in anticipation of it, whereas they might not have bought right away before. This trend could also continue to stoke inflation by pushing prices up sooner than planned.

Suppose your business sells anything with a logistics or a long supply pipeline that is adversely affected by the successful recovery. In that case, it could slow down your sales and profits – like a bike shop, for example. The problem is that even though sales are slowing down, many of your costs – rent, wages, insurance, loan payments, etc. don’t stop. Do you have something like a line of credit in place if that happens, or do you know how you would cover any potential temporary shortfalls?

Paying very close attention to their company’s day-to-day financial numbers – especially cash flows is not something many small business owners enjoy or do well. It’s not that they can’t, but they are often are more focused on the day-to-day running of the business. But these are extraordinary times. Don’t get caught by surprise.

This blog entry is a slightly edited excerpt from Doug Carleton's 'The Daily Life Of A Small Business Owner' series. Doug was a mentor with SCORE, Startup Virginia, and Lighthouse Labs, and has 25+ years of experience in small business finance including 12 years in SBA lending. To contact Doug directly, please email him at