Many businesses took a severe hit by the COVID-led disruptions experienced across all sectors. It was not just the small business owners who were affected. Even the large corporations such as SAP, Under Armour, and Rolls-Royce saw their revenue wiped out overnight.
From supply chain breakdowns to shrinking consumer demand and mobility restrictions for employees, the devastating impact of the global health crisis has been multi-faceted.
But together with the severe disruptions to the local- and international-economic landscape, it has also created multiple opportunities of a different kind for businesses. And for small business owners, these could present new avenues for growth and sustainability.
1. Booming online demand
The mobility restrictions posed by the pandemic have accelerated the digital transition of many consumers.
McKinsey reports this trend across various sectors. In fact, some industries such as grocery, apparel, banking, and entertainment have seen double-digit growth in the adoption of digital channels by first-time users.
Nike, for instance, reported a staggering 82% jump in sales for its online retailing business, while its high street stores lagged behind due to closures.
And this trend is expected to continue, even following the pandemic. According to studies, 58% of consumers plan to do more online shopping post-COVID than they did earlier. And 80% of business buyers expressed similar sentiments.
This opens up new opportunities for small business owners to increase the adoption of digital platforms to engage consumers and drive conversions. With more customers now willing to try out digital channels, many small businesses that earlier depended on a high street presence can safely initiate their online transition.
Besides cutting down overhead expenses such as rent and utilities, this transition could provide greater efficiencies and the agility to respond faster to market demands.
And unlike on the high street, competing online doesn’t require keeping up appearances with massive investments in offices and stores. It can allow smaller businesses and startups to compete with larger brands side by side with confidence. Brands such as Dollar Shave Club have already done this with phenomenal success.
2. The rise of the freelance economy
Many people have been left unemployed since the pandemic, as companies trim down their workforce to keep their heads above the water.
Meanwhile, the freelance workforce has been booming, contributing $1.2 trillion to the US economy in 2020. That’s a staggering 22% jump from the previous year.
And more and more highly skilled professionals are now turning to independent work, either by choice or circumstance. From legal and accounting to management consulting and even sales, the skills on offer are expanding.
This allows small business owners access to important functional and operational support with greater flexibility. Instead of increasing the permanent staff count and the associated expenses, they can now hire skilled services on a need basis.
And these services also come at a lower cost. For example, you can now hire highly skilled and experienced independent management consultants at much lower rates than what you would have otherwise paid a consultancy.
Freelancer platforms have also risen in numbers as they mediate the rising transactions between businesses and independent workers. They offer access to a wider and more global talent pool, secure and transparent transactions, and easier assessments of skill levels through ratings and reviews.
So, the best of talent is no longer limited to large corporations. Small businesses have an equal opportunity to benefit from their skills.
3. Rethinking how you do business
As COVID-19 altered consumer behavior, it has forced businesses to re-assess how they do business and create value. It’s no longer about strength and might, but rather about developing agility to respond to rapidly evolving market demands.
This provides smaller businesses with a unique advantage, as they can often develop a greater nimbleness to respond much faster.
Smaller apparel manufacturers, for example, have switched to producing personal protective gear to compensate for the cancellations of their regular orders.
And yoga and fitness studios are switching to online classes now, as mental and physical health has become a growing concern for many people facing restricted mobility.
Concerns such as safety, health and wellness, and technology will dominate consumer behavior long into the future. And many customers will continue to prioritize value and essentials as they plan for future catastrophes and uncertainties. All these are creating opportunities for small business owners to adopt new ways of thinking, innovating, collaborating, and creating value.
COVID-19 has certainly shaken up businesses, both small and large. While it may remain an uphill battle for many companies in the months to come, some of these pandemic-led disruptions might represent a much-needed jolt for businesses to reimagine their future.
And for small business owners, this could in fact create opportunities to remain competitive and build sustainable businesses. While the impact of these opportunities could vary among companies, they could provide a fighting chance for many of them.