With the UK re-entering another lockdown, most businesses may still face the challenges that were presented in 2020. Whilst we may not be as close to "going back to normal" as we might've hoped, there are still businesses that are thriving in the new norm we are currently living in.
We've found some tips to help small businesses adapt for success!
Xero commissioned Forrester Consulting to investigate the impact of the challenges in 2020 on small businesses and pinpoint the strategies that have aided businesses to be successful despite these challenges.
"The study is the result of over 2,000 surveys with small business owners
and consumers across six countries: Singapore, Australia, New Zealand,
Canada, the U.S. and the UK. Ten in-depth interviews with SMBs were
also conducted. It gets to the heart of what's hurting small businesses
right now - and what's helping them."
Three Key Areas
There are three key areas that Forrester looked at when determining how adaptive a business is. These key areas are:
- Market Adaptiveness - proactively thinking about their business and their customers and pivot their strategies in that way to better serve them.
- Technology Adaptiveness - improve technology or leverage technologies in order to enable business change, to improve the experience, and to improve their internal efficiencies within the organisation.
- Organisational Adaptiveness - how are firms actually changing the way they work?
From the study, increasing digital marketing efforts and engagement with online marketing was the top strategy for businesses that have been surviving and thriving in these times. This includes increased deployment in company website and social media pages and making more effort with email and marketing automation tools.
Businesses that have become more proactive in using digital technologies are now using cloud-hosted technology services. These small business respondents also report earning a much higher proportion of revenue online instead of through physical stores!
53% of small business revenue has come from online channels as opposed to physical during this period - this is 12% higher than in 2019.
You can read the full study here.
How we adapted at That's Ideal
Here at That's Ideal, we began to put more focus into the marketing and branding side of the business in 2020. This included a new logo and design, starting up an Instagram and working on our website and blog! This is something we will continue to work on in 2021 as we adapt.
Though we have always been cloud-based, we've noticed a shift in some of our clients as they've moved to become solely cloud-based too. We use Xero for our bookkeeping along with other add-ons such as:
- ReceiptBank which helps to optimise and streamline the bank reconciliation process
- Xavier which offers clean-up and insight tools so we can help our clients be more efficient with their finances, and assist with our accuracy and precision with their bookkeeping
Accessing Government Support
According to Forrester's report, 74% of small business owners have found or planned to leverage some form of government support.
Wage subsidies are the most common form of support (38%), followed by business loan repayment flexibility (30%) and government-assisted loans (29%).
For those of you based in the UK, we have written previous blogs about the help you can get from Gov UK in regards to the extended furlough scheme. We've also written a blog about how to handle expenses and benefits for your employees, which may be useful for you if you have employees working from home at the moment due to lockdown restrictions.
Whilst we can't cover everything that the report found, it is clear that those small businesses who pivoted and adapted have been able to survive these challenges. Strategic-thinking also seems to be vital for those businesses who have thrived during 2020.
You can find the full report from Forrester here.