This seems to be another console issue since it doesn't happen on PC, but it has been documented since the day Mr. Krabs dropped. Really hope we can get a hotfix for this soon, among other things.
I like Krabs, but he definitely does feel weak starting out. Penniless Krabs is inarguably the worst character in the game, so he kinda needs at least one bar of money to get the ball rolling, which is what Down Special is for. He's not my favorite character to play (that'd be Zim, in spite of everything), but I am a fan of how reachy and punchy a lot of his moves are - Back Air and Neutral Special are my personal favorites. A strong addition to my rotation of secondaries, if not quite main material.