Report: Holiday spending to reach $263B, with $109 N opportunity in revenue for small businesses.
The 2025 holiday shopping season is here—and shoppers are ready to splurge, according to this year’s Holiday Shopping Survey published by Intuit QuickBooks. Despite anxious whispers of tariffs and inflation, consumers are prepared to throw open their wallets and spend 25% more than last year—an estimated $263 billion.
And small businesses stand to benefit big. 41% of that spending—roughly $109 billion—is headed to Main Street. For many, the stakes couldn’t be higher: 93% of small businesses say holiday sales are vital to their success this year.
These insights come from a new Intuit QuickBooks commissioned survey of 6,000 U.S. consumers and 1,000 small business owners and decision-makers, conducted in September 2025.
Together, the data paints a picture of a holiday season defined by resilience, loyalty to small businesses, and new shopping behaviors.
Despite some fears about tariffs and higher costs (86% of consumers say tariffs and inflation are on their minds this season), holiday shoppers aren’t holding back. Almost half (44%) say they expect to spend more this holiday season than they did last year. Only 16% plan to spend less.
This adds up to a hefty shopping haul – overall consumer spending is projected to increase by 25% year-over-year, reaching an estimated $263 billion – up from $211 billion in 2024.
Shoppers are showing up for small businesses
Forget the mall rush – this year, shoppers are making a beeline for Main Street. Consumers are expected to spend 44% more at small businesses this holiday season than they did last year – an estimated $109 billion total. Younger consumers are leading the charge: 52% of Gen Z say they plan to spend more at small businesses this year, compared to 31% of Gen Xers and just 19% of Boomers.
On average, shoppers plan to do 41% of their holiday shopping at small businesses (up from 36% last year). And this isn’t just a passing trend, 9 in 10 consumers say it’s important to them to support small businesses over big retailers. For a third, it’s not just important, it’s non-negotiable.
Why the shift? Sure, small shops often mean higher-quality gifts (45% of respondents say this is why they choose to shop small), better customer service (36%), or more personalization (32%). But the number one reason is far simpler: community.
Nearly half (48%) say they shop small to support local businesses and strengthen their neighborhoods.
Shoppers are cutting corners—but not on gifts
So how are consumers affording this holiday splurge? By getting strategic. Most are keeping
it responsible, using debit cards (50% say they’ll fund their holiday shopping this way), cash (45%), or paying off credit cards each month (37%). Less than one in five (19%) plan to carry balances on their credit cards.
Why the sacrifices? For 42% of consumers, giving to loved ones matters more than anything else right now—even more than keeping up with daily essentials. It’s a season of trade-offs, but also of priorities: gifts that feel meaningful, purchases that support small businesses, and a clear shift toward quality over quantity.
But here’s where it gets interesting: 47% of shoppers are cutting back in other areas to free up room for gifts. That means fewer nights out, fewer weekend getaways, and for 16% of people – even fewer groceries in the cart or skipped healthcare costs.
Small businesses are betting big on the holidays
For small businesses, the holidays aren’t another sales period – they’re a make-or-break moment. More than 9 in 10 (93%) say holiday sales are vital to their survival this year – a massive 52% jump from last year. For nearly 6 in 10 (59%), that revenue is “very” to “critically important.”
The good news? They’re feeling optimistic. Nearly two-thirds (65%) of business owners expect to make more money this holiday season than in years past. On average, they’re counting on holiday sales to deliver a 42% year-over-year boost – nearly half (47%) of their entire annual revenue.
And they’re not just being hopeful – 89% believe their customers will spend enough to help them hit their targets. For some, that means leveling up from a good year to a great one. For others, it’s their one big shot to turn things around.
Tariffs and inflation loom
But it’s not all sugarplums and sales spikes. Two-thirds (68%) of small businesses report that tariffs have had a significant impact on them this year. Some are reacting by raising prices for customers (32% say they’ve done this), while others are swallowing higher costs themselves (30%). A quarter (25%) were able to stock up on inventory early (25%). Product-based businesses are feeling it the most: 71% report significant tariff pain, compared to 57% of service businesses.
And more than half (55%) fear higher costs could scare shoppers away. To keep customers engaged, business owners are fighting back with exclusive deals (44%), heavier advertising or social media outreach (40%), and standout customer service (37%).
Competition presses in from all sides
As business owners strive to keep their cool under the pressure of rising costs, the competitive landscape is heating up. Two-thirds (66%) say big-box retailers are their fiercest competition. But here’s the twist: half (50%) also expect more competition from fellow small businesses – both figures up 35% year-over-year. Only 8% expect less competition from other small businesses.
Translation? Everyone’s fighting harder for every sale. Standing out this season isn’t optional – it’s survival.
Source:
quickbooks.intuit.com/r/small-business-data/holiday-shopping-survey-download
/ReportHolidayspendingtoreach
