Ed Jay is the president of Newfold Digitala leading web and commerce technology company serving nearly 7 million customers worldwide.
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Our world is in an ever-changing state; there is no doubt about it. The challenges posed by the pandemic have turned into new concerns, including a potential recession, labor shortages and supply chain uncertainty. Although ‘unprecedented times’ has become a bit of a cliché, the economic ups and downs of recent years have taught us that there is no roadmap for dealing with chaos.
An unexpected twist is that large companies seem to be hit harder than in the past. Many are scrambling under the pressure of inflation and a decline in consumer demand. Powerhouses like Shopify and Tesla have fired, and Target needs aggressive product discounts due to overestimated demand and excess inventory.
Small businesses, on the other hand, have the advantage of unique characteristics and assets that point them to survival. By staying sloppy and finding opportunity in the chaos, small businesses can channel energy into quick decisions, agility, and customization. Business headlines translate into lessons learned, and by focusing on staying true to their brand, they can avoid the mistakes of big companies. In today’s tumultuous climate, every new challenge opens the door to a fitting opportunity.
The importance of resilience
In difficult times, nothing is more important than building business and personal resilience, especially in today’s competitive landscape where about a third of small businesses survive no more than two years. Historically, in times of economic downturn, small to medium-sized businesses have struggled to survive. During the first wave of the pandemic, small and medium-sized businesses learned the definition of resilience the hard way. But gradually they found ways to adapt.
For example, many restaurants embraced a delivery model and adapted their menu offerings to include large family meals. Even many high-end restaurants have adapted their model to account for the reduced dine-in activity. Other companies switched to video. Services that would have attracted little interest before the pandemic, such as gym classes and yoga classes, thrived in a changed economy. And of course, countless small businesses in almost every industry started selling online.
While there is no guide to achieving business resilience, a recent report found that truly resilient companies tend to be leaders who think ahead, rethink their operations frequently, and put people first.
Small business owners need to be resilient if they are to survive today’s challenges. Their personal ability to carry on when the going gets tough is part of it, but they also need to be ready to adapt to changes. That means learning to separate the important from the trivial. It can be daunting to get that balance right, but learning, understanding and defining your destiny will help you move in the right direction because there is always more than one path to reach your goal.
Turning challenges into opportunities
Some predictions point to an ongoing trend of job losses and wage cuts for white-collar workers, a trend driven by companies adapting in anticipation of a more difficult economic outlook. Despite this, recent years have shown that SMEs are determined to find ways to survive.
During the pandemic, small businesses adapted in every way, including using financing such as the Paycheck Protection Program loans. Now survival is more focused on adapting business operations to meet the updated version of the ‘new normal’. In many cases, challenge and opportunity go hand in hand. The factors that categorize small businesses as “small” also make it easier for them to get through tough times.
In addition to understanding business resilience, an understanding of the digital technology available in the market has tipped the scales in favor of small businesses. The democratization of technology has now made it possible to do more with less. For example, small business owners may consider building their own websites without paying for custom services. (Full disclosure: My company offers these types of solutions, as do others.)
The leg of small companies against the big boys
Let’s look at additional examples from Amazon and Walmart. It’s often said that 90% of Americans live near a Walmart, and most are just a click away from Amazon. Despite their ubiquity in our society, inflation and supply chain problems have not spared these two superstores, forcing them to compete for extra grit for consumer preference.
From my perspective, small businesses can move faster than retail giants while selling the same types of products. By knowing their customers and markets and developing an online presence, SMBs can sell their products and services to anyone, anywhere.
As key drivers of both economic growth and social development, small businesses tend to foster competition and innovation in every aspect of our society. By leveraging their benefits of flexibility and community loyalty, small business owners can bypass large companies to provide a truly unparalleled shopping experience.
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