Since the pandemic, businesses have gone through the wringer with hits to their profits and workforce. These issues have particularly affected smaller businesses with significantly smaller profit margins. However, the current uncertain times have also made it a perfect opportunity for small businesses to develop innovative and creative strategies to bounce back. If anything, it’s their creativity that has helped them boom despite the pandemic and set them apart from other more prominent firms.
Bigger companies are bound to their traditional practices by their board, a responsibility to their shareholders, possibly outdated logistics, management, and production structures. This is a sharp contrast to small businesses that can implement sudden changes on a broad but local scale. Various market factors and strategies have contributed to the small business boom during the pandemic. Here are just some of the most common factors to emerge.
1. Focus on local
Small businesses have been more attainable to succeed because their focus is purely on the local market. So essentially, this means fewer competitors in the industry. Their strategy and vision aren’t targeted towards reaching the customer base worldwide but rather a local perspective. So it’s easier to focus all your marketing and advertising strategies towards a specific demographic when a business targets local customers. With a local audience, not only is this more affordable and can save small business expenses, but it’s also a more direct and target approach towards their market. This also reduces logistics costs as localizing your supply chain and sales avenues make for a more targeted and efficient approach.
2. Pivoting business models
Pivoting business models entails a lot of leeway regarding timelines and operational schedules. For example, completely changing your main sales avenue from brick n mortar stores to e-commerce requires restructuring your warehousing and freight plans and factoring in new costs. Another great example can be seen in the restaurant industry in major cities.
Many restaurants have gone mobile to lower their overhead costs and keep up with the market’s demands. Shifting from a physical location to using a fo0od truck or pop-up shop was no easy ride for these businesses. However, going mobile allowed them to move to more suburban areas, which increased population as city folk started moving away from densely populated metropolitan areas. These changes are executable at a small scale within a few months. Still, such changes are significantly more difficult for more prominent corporations to embark on.
3. Less workforce
Small businesses generally don’t need much workforce to keep their operations up and running. Since this isn’t a multinational business with a global target market, this reduces the need for multiple employees who specialize in just one aspect of the company. All small businesses need is one or two employees from the essential parts, whether operations or finance. With fewer employees to manage and handle, it’s easier for small businesses to focus on the vital aspects, making their costs, logistics, and management needs easier to meet.
As a result, this is one of the unexpected aspects that has caused small businesses to bloom during the pandemic. Despite the few employees, proper hiring and training protocols result in a well-equipped workforce that can get the job done and give you an edge over the competition.
4. Digital efforts
There’s no denying how businesses since the pandemic became digitally adept, especially when marketing and advertising their products. Whether in coming up with the perfect graphic design for the right engaging social media post or creating an attractive advertising video, small businesses are putting more effort digitally. The pandemic has encouraged us to have more free time than we’d like. So even companies use that free time to be creative and strategic digitally.
Before the pandemic, digital sales were only at 5 percent, increasing to 40 percent in the new normal. An online presence has now become an essential part of the business model in any industry. Local handymen, plumbing services, and beauticians started making waves on the internet. An online presence allowed clients to reach them quicker and more efficiently.
5. Customer satisfaction
Combining all these factors makes it easier for small businesses to achieve customer satisfaction and customer retention. They’re able to convert new customers into repeat ones, particularly if those local customers liked their overall experience. Since small businesses have focused their target market locally and changed their approach through business pivoting, it’s a lot easier to achieve customer satisfaction and retention. A smaller team, a sample size, and a product line ensure quality control or fewer people to manage. As such, you can easily find mistakes, correct them quickly, and cut through the red tape that most global corporations have.
Bigger businesses might have an edge regarding the losses their bottom lines can take. Still, innovative small businesses are ahead of the curve for successfully navigating the pandemic.