Rising costs are continuing to squeeze American wallets — and perhaps nowhere is that more apparent than in the food sector. According to the latest Experian Commercial Pulse Report (October 14, 2025), food prices are having a profound impact on where and how consumers choose to eat. With the Consumer Price Index for food rising 3.2% year-over-year, both full-service and limited-service restaurants are feeling the heat.
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Specifically, Full-Service Restaurant prices have surged 4.6%, while Limited-Service locations have seen more modest increases of 3.2%, the lowest pace in over a year. As price-sensitive consumers pull back on discretionary spending, Experian’s data shows a notable shift toward more affordable dining options—or a return to eating at home.
Credit Demand Is Strong, But Approval May Be Slipping
Even with shifting consumer habits, restaurants are not sitting idle. Experian’s credit data reveals that both Full-Service and Limited-Service Restaurants are actively seeking commercial credit — a likely sign of increased working capital needs in the face of inflation and tighter margins.
However, access to that credit appears to be narrowing.
- Commercial inquiries from Full-Service Restaurants have risen to 1.7x pre-pandemic levels.
- Limited-Service Restaurants follow closely at 1.5x.
- Yet the number of credit-active Limited-Service establishments has declined, suggesting either a slowdown in approvals or reduced eligibility.
This contrast implies that demand for financing is rising faster than approval rates, especially for smaller or newer businesses trying to stay competitive amid rising costs.
Shrinking Credit Limits, Rising Utilization
Restaurants are not only facing tighter access but also leaner terms. Average credit limits for new commercial card accounts have fallen significantly since 2021:
- Full-Service Restaurants: Down from $11,500 to under $6,000
- Limited-Service Restaurants: Also trending downward
- Groceries (used as a benchmark for at-home eating): Down from $13,000 to $9,000
At the same time, credit utilization rates are climbing — an early warning sign that businesses are relying more heavily on revolving credit to manage day-to-day operations.
- Full-Service Restaurants now use 31.9% of available credit, up 4.6 points since 2023.
- Limited-Service Restaurants trail close behind at 31.8%.
- Groceries come in at 28.8%, showing increased pressure even in the at-home dining sector.
Taken together, this combination of lower credit limits and higher utilization points to a tightening credit environment, which may be challenging for restaurants to navigate through the holiday and post-holiday seasons.
Commercial Risk Trends Tell a Mixed Story
One of the more nuanced insights in Experian’s report is how different restaurant types are weathering the current environment from a risk perspective:
- Full-Service Restaurants show only a modest decline in commercial risk scores (–0.8 points), suggesting relative resilience despite financial pressures.
- Limited-Service Restaurants, interestingly, saw a +1.4 point improvement in risk scores—indicating increased stability and better adaptation to current market conditions.
- In contrast, grocery retailers—the benchmark for “eat-at-home” sectors—experienced a -1.8 point drop in their risk scores, highlighting greater strain in that segment.
This divergence reflects a growing consumer shift toward lower-cost food options like quick-service dining, potentially at the expense of both full-service restaurants and grocers.
What It Means for Lenders and Business Strategy
These trends carry significant implications for financial institutions, credit providers, and small business advisors:
- Rising inquiries + shrinking credit limits = greater risk of liquidity stress
- Stronger risk scores for Limited-Service = opportunity for more targeted lending or product offerings
- Elevated utilization rates = need to monitor credit performance closely, especially for revolving credit
For business owners and operators, understanding these dynamics is crucial to building resilience in a volatile market. Strategic decisions around financing, menu pricing, staffing, and technology adoption will likely make or break performance through the next few quarters.
Conclusion: A Sector Under Pressure — but not out
While economic headwinds persist, the restaurant industry shows remarkable adaptability. Whether it’s shifting toward leaner operations, targeting lower-income consumers, or increasing credit usage to bridge cash flow gaps, the sector is evolving in real-time.
As always, Experian’s insights provide a critical lens into these movements—helping lenders, business leaders, and policymakers make smarter decisions amid uncertainty.
For the full analysis, including all small business credit trends, read the latest Experian Commercial Pulse Report.
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- ✔ Subscribe to our YouTube channel for regular updates on small business trends.
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Small business formation remains one of the more notable trends in the U.S. economy. In August 532,000 new businesses launched across the country. While that was down from July, it remained well above historical averages. Since July 2020, an average of 455,000 new businesses have opened each month—56% higher than the pre-pandemic monthly average in 2018 and 2019. But the national numbers only tell part of the story. Watch The Commercial Pulse Update Experian’s latest Commercial Pulse report analysis examines where this growth is occurring and what it means for the commercial credit market. The data show that the South has emerged as an important center of small-business growth. And the businesses driving that expansion tend to have a different profile from their counterparts in other regions. For commercial lenders, understanding those differences can provide valuable context when evaluating new opportunities, credit demand and portfolio risk. Business growth is shifting geographically New business formation has increased across all U.S. regions, but the pace has not been uniform. Prior to 2018, regional differences in growth were relatively modest. During the pandemic years of 2020 and 2021, the South led the country in new business application growth. Since 2022, the West has posted the strongest growth, while the South continues to account for the greatest volume of new business openings. One factor providing context for that growth is population. The population of the South has grown more than 7% since 2019. Since 2020 alone, the region has added more than 3.6 million residents, outpacing every other U.S. region. Meanwhile, populations in other parts of the country declined between 2020 and 2022 before beginning to recover. Business formation and population movement do not necessarily have a simple cause-and-effect relationship. But their parallel growth highlights how the geographic makeup of both consumers and businesses has been changing. Credit-active businesses are growing even faster in the South The shift becomes even clearer when looking at businesses using commercial credit. Experian data shows the number of credit-active businesses in the United States has increased 55% since 2018. Every region participated in that expansion, but the South experienced the greatest growth at 70%, followed by the North at 52%, West at 50% and Midwest at 36%. The South now represents approximately 39% of U.S. credit-active businesses. It also accounted for more than 40% of newly opened commercial accounts in 2026, compared with 37% in 2019. For commercial credit organizations, that means the South represents not just a growing population of businesses, but an increasingly significant share of businesses participating in the commercial credit ecosystem. Southern businesses tend to be smaller and younger The composition of this growth is just as important as its scale. Credit-active businesses in the South and West tend to skew smaller and younger than those in the North and Midwest. In the South, 53% of businesses generate less than $500,000 in annual revenue, while 59% have fewer than five employees. Only 36% have been operating for more than 10 years, compared with 43% in the Midwest. Those characteristics can influence how businesses interact with credit. A younger business, for example, may have had less time to establish multiple commercial credit relationships. That pattern appears in Experian’s data. Across the United States, the average number of commercial credit accounts per business has declined from approximately 1.8 in 2018 to 1.5 in 2026. The South experienced the steepest decline and currently has the fewest accounts per business. At the same time, commercial credit inquiries have increased since 2023, most recently peaking in early 2026. Inquiry rates have typically been higher in the Midwest and South. The combination of fewer existing accounts and elevated inquiry activity provides useful context for lenders seeking to understand the credit needs of a growing population of younger businesses. Credit utilization tells another part of the story Regional differences also appear after businesses establish credit relationships. Businesses in the Midwest and North opening new commercial accounts tend to receive higher lines than businesses in the South and West. At the same time, businesses in the South show higher commercial card utilization despite carrying somewhat lower average balances. Experian’s analysis points to lower credit lines as an important factor behind that relationship. These trends reinforce why looking beyond a single credit metric can be important. Higher utilization, for example, can take on additional context when considered alongside credit-line size, business age, balances and regional business formation. Growth brings opportunities—and risk factors to monitor Despite significant growth and changes in business composition, regional credit performance has remained relatively steady. Commercial delinquencies across all regions are near pre-pandemic levels, while commercial credit risk scores have been relatively stable. There are regional differences worth monitoring, however. Businesses in the South have lower average commercial credit scores than businesses in the other regions analyzed, and delinquency rates tend to be higher in the North and South than in the Midwest and West. The broader takeaway is not simply that there are more small businesses in the South. It is that the composition of the commercial market is evolving alongside that growth. The South represents a growing share of credit-active businesses and new commercial accounts. Many of those businesses are younger, smaller and have fewer established commercial credit relationships. Their credit needs and behaviors may therefore differ from those of more mature businesses in other parts of the country. For commercial lenders and risk leaders, understanding those distinctions can help provide greater context around acquisition, underwriting and portfolio management decisions. As small business formation continues, Experian will continue monitoring where that growth is occurring—and how the changing business landscape is showing up in commercial credit behavior. Learn more ✔ Visit our Commercial Insights Hub for in-depth reports and expert analysis. ✔ Subscribe to our YouTube channel for regular updates on small business trends. ✔ Connect with your Experian account team to explore how data-driven insights can help your business grow. Download the Commercial Pulse Report Visit Commercial Insights Hub Where are small businesses growing in the U.S.? Experian data points to significant growth in the South. While new business formation has increased across the country, the South has consistently recorded the highest volume of new business openings and has seen the number of credit-active businesses grow 70% since 2018—compared with 55% nationally. Where are small businesses growing the most? The South has consistently had the largest volume of new business openings. The South led application growth during 2020–2021, while the West has posted the strongest growth rates since 2022. That distinction is important because it prevents the SEO headline from overstating what the data shows. Why has small business growth been so strong in the southern U.S.? The South has added more than 3.6 million residents since 2020, substantially outpacing other regions. Our report establishes a correlation rather than causation. 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