Embracing digital helping businesses navigate cost of living crisis
Embracing the power of digital has been crucial for small businesses in weathering the Covid-19 pandemic and the cost of living crisis. This is according to new research, which found over half of firms have grown their income by at least five percent through using tech since 2020, and one in ten have raised their revenues by 50% this way.
The new ‘Unlocking Digital Potential’ report from Small Business Britain and BT – which explores how to maximise online opportunities for the nation’s six million small businesses, identified a positive trend for small firms to adopt revenue-generating digital solutions. Over half (55%) of small businesses added new social media channels like Instagram and TikTok, with 42% building a new website over the last two years.
But despite encouraging signs that many more business owners are now using technology to manage their businesses better, the report also signalled a massive opportunity for more to save time and reduce costs in this way, particularly when facing rising expenditure elsewhere. Only one-fifth (21%) are investing in productivity tools to save time and streamline processes.
The report also identified a concerning gap in digital confidence levels amongst small businesses and pointed to greater support needed for entrepreneurs to build digital skills. While over a third of small businesses feel confident with digital, there is a real need to help the remainder not yet at that comfort level.
When asked what is holding back their tech adoption, businesses point overwhelmingly to cost (64%), skills (44%) and complexity (26%) as the key barriers. And 83% of small businesses say they do not have enough support with digital skills.
“The pandemic has created a remarkably different small business landscape. Digital technologies have been a lifeline and an important enabler for small firms as they battled to do business during the pandemic,” said Michelle Ovens CBE, Founder of Small Business Britain.
“But these insights and learnings show what is needed to really supercharge things, and ensure the smallest of businesses use digital to unlock the world of magic and opportunity that is within them. The imperative to do so is clear – without confidence and an openness to new things, businesses stay in their comfort zone, and miss out on great new opportunities.”
To ensure that all small businesses reap these digital rewards, the importance of developing new technologies that are tailored to small businesses, deliver high value, and are built with diversity in mind is highlighted. The need for wider accessibility of support and finance for ethnic minority-led businesses and disabled-led businesses, that can find themselves left out from sources of help, is also called out, with a need for more diverse role models to encourage this.
“Small businesses need an entirely bespoke approach to digital that is right for them, which understands their situation, their needs, their customers, and their ambition. We especially need ‘on-ramps’ available to enable micro-businesses to access the smartest technology,” said Michelle Ovens.
“Language is vital too, while much has been said about the huge ‘digital transformation’ witnessed across the country in recent years, small businesses do not necessarily think in these terms, or refer to the leaps they are making in this way.”
Business owners like Ada Obioha, Founder of Ada Virtual, has found digital solutions have opened up opportunities for her business, but she is keen to ground this in support for real people and real-world activities.
“We gained several new clients through new technologies, such as video and email marketing,” said Ada Obioha. “But even though we talk about digitisation, we use it to remind people there are still humans working behind the scenes.”
Chris Sims, Managing Director for BT’s SoHo (Single Office/Home Office) unit, said: “This new research shows the true scale of digital opportunity out there for small businesses, but also the big hurdles that remain to realising these benefits for all. By making digital advice more open and accessible to all small firms, we can help unlock their digital potential to help them grow. This is vital as the future of our high streets, communities, and the economy is dependent upon their success.”