How is the new normal affecting small businesses?
Covid-19 changed many things about consumer and company behaviours. Small businesses were forced to adapt to survive during the pandemic and must continue to do so as we settle into the world’s new normal.
Despite the numerous challenges faced in recent years, small businesses still dominate. Statistics from 2021 show that 99.9% of businesses within the private sector were small, meaning the UK had an estimated 5.5 million SMEs. This number shows a significant increase from previous years, despite the pandemic.
Adapting during the Covid-19 pandemic
As covid-19 began spreading worldwide, we experienced things that many of us never had before. The pandemic was an unexpected and unprecedented event.
Governments, businesses, and individuals were forced to make constant changes as new information came to light week after week and month after month.
The UK saw strict restrictions imposed in early 2020, with the first national lockdown introduced on the 23rd of March. The country was in and out of lockdown for the next year and a half, and consumers were largely unable to visit physical store locations.
As the pandemic continued, businesses lost more money and had to find ways to work around the restrictions. In fact, 45% of small and medium enterprises in the UK altered their business model because of covid-19.
Some of the most notable adjustments made over the last couple of years included adopting technology, remote working, contactless delivery, and stricter safety precautions. Many of these are still in effect today.
Opening a business anytime can be daunting, but opening post-pandemic is particularly so. Therefore, it’s vital that you know what the most common mistakes made when opening a small business are so you can avoid them.
Innovation in a post-pandemic world
Business closures in the third quarter of 2021 were 50% higher than the year before, suggesting that many businesses struggled to maintain the flexibility necessary for continuing changes.
This represents a daunting challenge for small businesses opening in 2022 and beyond. The need to innovate will be ongoing as the world continues to shift. However, companies, especially SMEs, prove they can innovate time and time again.
There are many benefits of running a small business, one of which is the ability to adapt to changes as and when they happen. Larger organisations tend to be slow to make changes because they are weighed down by bureaucracy. In most cases, well-developed businesses simply can’t acclimate as quickly as small ones.
We saw small businesses make the most of their flexibility and ability to adapt throughout the various stages of the pandemic. Today, the world is different from the one it was two years ago. Yet, small businesses have taken many of these changes in their stride.
Technology has long been seen as the future of business. The pandemic saw this future vision become a reality fast.
Most businesses, no matter their size, now offer customers the option of cashless and contactless payments. While contactless has been around for many years, it spread further because of the pandemic and consumer desire.
Many of us once considered technology a big corporation game. For small businesses, technology often seemed out of reach without the help of a dedicated team like larger businesses had.
The pandemic saw a shift in perception. Small businesses were among the first to embrace new technology. MSPs (Managed Service Providers) have started to fill the gap between the technological needs and abilities of other small businesses.
MSPs can provide IT and other services, allowing even small businesses to offer the omnichannel experience that modern consumers crave. For instance, if a small business requires cloud technology and maintenance, they can outsource this to an MSP.
If you have been anywhere in the past two years, you will have seen a hand sanitiser somewhere near the entrance of every building. While face masks are fading out of use, most physical locations have kept disinfectant at the ready for customers and staff.
Contactless delivery may have started to avoid encounters that could further the spread of coronavirus, but it seems the service is here to stay.
Businesses of all sizes now offer contactless delivery. Small companies that may not handle the delivery of goods themselves often use delivery services that provide contactless delivery as standard or as an option.
Learning new skills
Small businesses that changed their operating model to meet covid-19 requirements often needed their entire small team to learn new skills.
Employees of SMEs often had to acquire a broader skill base to keep up with changes. This growth mindset, already an essential aspect of smaller businesses, has strengthened significantly since the pandemic’s start.
Risk vs opportunity in SMEs
A willingness to take risks is perhaps one of the core reasons we see small businesses adapting so well to the world’s new normal.
Larger corporations have more to lose if an innovation goes wrong. However, for small businesses, the potential reward often outweighs the risk.
For instance, small businesses are now more likely to use the cloud because it offers them the scalability and flexibility they need. However, the cloud also comes with security risks, notably cyber attacks that could result in data breaches.
Despite this, SMEs have embraced the cloud as an on-site infrastructure alternative. It allows their employees to work from anywhere. In this new normal, small businesses rely on each other to face potential threats, with MSPs providing services like security support.
Help for small businesses post-covid
During the pandemic, the UK government offered some assistance to SMEs, but what about now?
Small businesses can still find help during these times, but options are few and far between. The government offers limited funding and other organisations, like banks, remain risk-averse and unlikely to lend to small businesses.
Small businesses operating in the new normal
Realistically, it is still too early to know or comprehend the full extent of this new normal and how it will affect small businesses. Yet, we are already seeing transformations and patterns emerging.
Small businesses will need to keep their innovative spirit if they want to thrive in today’s market. If they wish to keep up, they will need to study and predict consumer behaviour to prepare to meet changing needs.