Almost half, or 47%, of small business owners have observed growing price sensitivity among buyers over the past six months, according to the latest small business survey conducted by Luminor bank*. At the same time, nearly a quarter, or 24%, of business owners are facing a situation in which customers now expect greater value for the same price.

When asked how their customers' expectations have changed over the past six months, most small business owners point to customers' price sensitivity (47%) and to customers expecting greater value for the same price (24%), while 27% of small business owners have observed no change in customer expectations.

“People's spending has become more considered – our own household surveys also show that buyers compare prices more often, weigh up alternatives and think more carefully about whether a product or service delivers a better overall experience. At the same time, Latvia's economy continues to grow steadily, and there is no reason to expect a significant deterioration in household purchasing power.

This means it is becoming ever more important for small businesses not only to offer a competitive price, but also to communicate their strengths clearly and give the customer a good experience – quality, convenient service or other benefits that can set them apart from the rest. In the long run, the most successful businesses will be those able to strike a balance not only between price and added value the customer can understand, but also the quality of their service,” says Uģis Počs, Head of the Small and Medium-sized Enterprise Service Department at Luminor.

Survey data show that 14% of business owners are seeing customers ask for digital or remote communication, while 8% report a clear demand for faster, more convenient service.

Across the Baltic states, the most pronounced shift in customer expectations is seen among Estonian small business owners – more than two-thirds (68%) report growing price sensitivity among customers, and a third face demand for greater value at the same price. In Lithuania, meanwhile, price sensitivity among customers is similar to Latvia, where the trend is observed by 46% and 47% of small business owners respectively.