What Small Businesses Did When Everyone Stayed Home
Lots of customers and workers were homebound for big chunks of 2020. That separated small businesses from their two most important sets of people. Many sought digital solutions to help solve the problem.
Shops and offices went online
As reported in the Small business trends 2021 report, there were three key signs that small businesses were heading online:
Businesses started shopping for ecommerce tools.
58% of customer spending went online.
Almost 50% of businesses declared plans to move technology to the cloud.
Businesses started shopping for ecommerce tools
From April to July, Xero small business subscribers started shopping for tools to build online shops and process online payments. For months, ecommerce tools were among the most searched-for items in the Xero app marketplace.
Customers took their business online
The scramble to go online was vindicated. Customers got stranded in their homes and, before long, it was reported that more than half of their spend (58%) was taking place online.
Work changed, big time
Salvaging sales was only half the battle for small businesses. They also needed to find ways to get the work done. That wasn’t easy with traditional work tools. And so when we surveyed businesses earlier this year, almost a half said they planned to move their technology to the cloud. Besides enabling them to work from anywhere, this will give them better visibility of their finances and allow them to apply quickly for government aid, if needed.
Productivity can happen anywhere
The ability to be productive from anywhere always sounded like a good idea. The tools have existed for a long time, with cloud solutions for things like document creation, email, meetings, accounting, inventory management, and more.
This year, we have seen evidence that online systems make businesses more resilient. Xero subscribers with at least one other business app suffered 12% less revenue loss through the global pandemic. As more businesses adopt digital tools, we expect the whole small business sector to get stronger.
Takeaways for small businesses
Customers did a lot more of their shopping online this year.
Ecommerce helped businesses salvage revenue during the pandemic.
Businesses are looking to move more and more of their functions online.