When costs go up and prices don't, someone covers the difference. In a lot of small busin…

When costs go up and prices don't, someone covers the difference. In a lot of small businesses, it's the owner.

KeyBank's 2026 small business survey found a third of owners are absorbing rising costs out of their own paycheck instead of passing them to customers. Inflation was still the top threat, named by 53%.

The instinct makes sense. Customers notice price changes, and those relationships took years to build.

But it hides the real numbers. If the business only works because the owner takes less, the margin on the P&L isn't the margin of the business. It includes a discount on the owner's own job.

Try one exercise. Put a fair market salary for your role into the numbers. Then look at which customers, jobs and services still make money. That list tells you where to hold prices, where to raise them, and where the work itself has to change.

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