Deep freeze impacts store traffic in January

A prolonged winter deep freeze dampened small business sales in January, as severe weather reduced store traffic and consumers pulled back after a heavy holiday spending season. Fiserv's Small Business Index, released Feb. 3, 2026, showed the impact was most pronounced in in-person transactions, signaling a customary post-holiday slowdown exacerbated by extreme weather conditions.

Year-over-year sales rose 0.7 percent in January, but month-over-month sales declined 0.5 percent, That pullback followed a robust finish to 2025. An analysis by Visa found U.S. consumer spending increased 4.2 percent over a seven-week period beginning Nov. 1, 2025, reflecting strong demand during the holiday shopping season.

Visa's figures, based on payment network data and survey-based estimates for other payment methods, aligned closely with holiday sales data reported by the National Retail Federation.

With winter storms impacting much of the country in late January, in-store sales posted the sharpest year-over-year decline (-2.0 percent) since mid-2022. Store foot traffic also dropped by 0.8 percent month over month.

A separate report, Winter Storm Fern Fiserv Special Report January 2026, issued by Fiserv on Jan. 28 revealed that winter storm Fern prompted consumers to stock up and hunker down, triggering an economic shock wave across the country. Grocery and retail activity spiked on Friday, Jan. 23 before snowfall, ice and plunging temperatures kept most consumers at home through Mon., Jan. 26.

Restaurants were hit hard

Restaurant activity collapsed over the weekend, especially in the southern and mid-Atlantic markets, which were hit hardest by widespread icing, power outages and dangerous roads brought on by Fern.

The Fiserv Small Business Index aggregates consumer spending derived from point-of-sale transaction data, including card, cash and check transactions in-store and online across 2 million small businesses.

These are additional insights Fiserv provided:

• Discretionary sales fell by 0.4 percent, year over year, and by 0.7 percent month over month.

• Professional and administrative services saw pockets of strength, growing 1.1 percent month over month, helped by growth in storm-related services. Tax preparation services charted accelerated growth of 9.3 percent YoY and 5.6 percent month over month.

• Retail held steady with core categories driving modest growth. Core retail (which includes groceries, clothing and furniture) delivered the most gains 1.5% YoY, while non-core retail, which includes gas, motor parts and building materials declined by 2.7 percent YoY.

• Restaurant sales fell by 1.8 percent YoY, driven by significant foot traffic declines (-3.6 percent) compared to 2025. Limited service restaurants (dining establishments where customers order and pay before eating) posted the largest declines in sales, dropping 3.4 percent YoY. Average ticket sizes rose 1.6 percent YoY, offering only a partial offset.

"In January, small business faced headwinds as consumers rebalanced their spending following a busy holiday season, and winter weather kept many at home during the latter half of the month," said Prasanna Dhore, chief data officer at Fiserv. "As a result, restaurants, hotels and several retail categories saw sharp slowdowns in sales, while select service-based businesses posted strong sale gains to start the year."

January’s results highlight how quickly external shocks can still disrupt in-person commerce, even as digital payments continue to dominate everyday transactions. As weather volatility, consumer caution and uneven demand persist, transaction data is increasingly becoming an early signal of where resilience and risk are emerging across the small business economy.

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