EJ Dalius small businesses’ challenges have compounded due to the COVID19 pandemic. The disease and its aftermath have posed an existential crisis for many SMEs regardless of the size, funding, and location. Small enterprises worldwide are reeling under the massive blow of the pandemic that has shredded the global economy. A survey by Facebook points to the challenges that small businesses are facing due to the pandemic. The study covered 86,000 owners, workers, and managers of US companies employing less than 500 people. EJ Dalius takes us through the findings of the report.
EJ Dalius Uncertainty looms large as small businesses stare at closures
Until June, when the Facebook report became public, 31% medium and small businesses. Have downed shutters in the preceding three months. It is especially bad for personal businesses as 52% have shut down, followed. By 43% in the food and beverage segment. And wellness and grooming and 41% belonging to professional services. Eric J Dalius points out that most of the closures. Were due to government orders of lockdowns while only 7% cited lack of demand. And 9% cited financial problems as the reasons for closing.
EJ Dalius Access to capital is challenging
Access to capital required to keep the businesses afloat during the pandemic is another big challenge that business owners face. Two-thirds of businesses are optimistic and hope to open in the future. 34% of those who are pessimistic and closed said that. It was due to their inability to pay rent and bills. At least 60% of businesses surveyed admitted that they were struggling with finances. And the biggest concern for 29% of businesses is paying salaries and wages. For 28%, the concern is for paying their bills. The numbers are much higher for hotels, restaurants, and cafes. Many businesses are turning to institutions for help.
Using internet tools to adapt to the crisis
While earlier, it was optional for businesses to go online, the pandemic has compelled. Almost all businesses use internet tools to keep their business afloat and stay in touch with consumers. This is a first-time experience for many businesses that had earlier not considered. It a priority but now consider it a primary way of conducting business. A lot of businesses are using various digital tools for ordering (23%), service delivery (16%), and digital payments (37%). The trend is especially catching up with women entrepreneurs. While digital tools are indeed helpful, it does not provide a complete solution to the problems.
Balancing work with home life
One of the biggest challenges for small businesses is to balance running a business. And looking after the household observes EJ Dalius. According to the survey data, although only 10% of business owners handled the dual responsibility of looking. After the business and household members, almost half admitted that it was too stressful to balance both. Household work posed great distraction for business with women entrepreneurs and managers reporting a higher number than men.
However, the silver lining is that despite the challenges, many small businesses are hopeful of seeing. The lights at the end of the tunnel. They are optimistic about a better future.