Small business owners have many concerns

When it comes to the economy, only a small percentage of small business owners expect improvement, which could be a bad sign for retailers

If the economy continues to grow at a slow pace, small- to medium-sized businesses could enter a period where cash flow is lagging. These trying times can be difficult for smaller retailers, and present numerous challenges, including the inability to purchase additional inventory. 

Fortunately, retail inventory financing is available to help out during periods where cash flow falls below normal levels. 

Slightly more than one-in-three small business owners said the national economy will improve in the next 12 months, according to Bank of America's Small Business Owners Report

The biggest concern among small business owners is the effectiveness of U.S. government leaders, cited by three-fourths of respondents. However, commodities prices, the recovery of consumer spending and health care costs weren't far behind, cited by 70 percent or more respondents. 

Small business owners showed increased confidence in May, but NFIB chief economist Bill Dunkelberg doesn't believe it means much. 

"Small-business confidence saw an uptick this last month, but it was a ho hum, yawn, at-least-it-didn't-go-down reading," said Dunkelberg. "The sub-par recovery persists for the small business sector."

Should small business continue to struggle, retailers of this size may need to increasingly rely on inventory financing

This type of asset-based lending allows a company to use current inventory as collateral to obtain a revolving line of credit. It can be useful in times where lagging cash flow prevents them from getting a loan from a bank, or when small retailers have limited available capital. 

Retail inventory financing can be beneficial in a couple ways, including giving small businesses the ability to keep shelves stocked and to operate at normal levels when cash flow is lagging.