A new survey from the National Association of Business Economics (NABE) reports that more than 40% of respondents expect to raise prices in the first quarter of 2014, marking the highest percentage in over a year. “Respondents report that strengthened sales growth was more widespread during the last quarter of 2013 than in the third quarter. Profit margins increased at more firms as fewer panelists reported rising materials costs,” said Jack Kleinhenz, president of NABE.
Sales are also looking positive, as 63% of survey respondents reported rising sales of goods or services at their firms. This is an increase of 21% over the third-quarter survey. Only 9% saw sales drop, which marks a decrease of three percentage points since the previous survey.
“Profits were good and sales are expected to stay and rise,” Kleinhenz said. “That’s a great sign for the economy, that demand is there, and consumers are willing to spend.”
The NABE survey also found that policy issues were not top of mind for respondents. When it comes to the Affordable Care Act, 75% said they do not expect the law to materially impact their businesses. The Federal Reserve’s decision to scale back its bond-buying program is also not seen as a major threat: 70% say it will have no impact on profitability and 94% say it will have no effect on capital expenditure plans.