For small businesses, systemizing your operations can help you scale your business without the extra hassle while also preparing your business for the unexpected. Many small businesses have the potential to grow with experts predicting them to add about $2.3 trillion to the global GDP growth.
Small businesses are a powerful and important aspect to the economy as a whole with them actually employing almost half of the nation’s workforce, but they are currently being held back by several different factors, with the COVID-19 pandemic being one of them.
The pandemic hit small businesses especially hard with 96% of small businesses being affected, many of which had to make huge pivots to remain in business while others are struggling each day to just stay afloat. 59% of them had to lay off a huge number of their employees while almost 30% of small businesses had to officially close their doors.
Interestingly enough, more women-led small businesses around the world reported being closed compared to men-led small businesses. Although the global small business closure rate fell from 24% to 18% even in the midst of a pandemic in 2021, minority-led small businesses were at least 50% more likely to experience permanent closure, reduced sales, and employee layoffs that seriously affected business.
However, just 34% of small businesses reported lower sales compared to the previous year with the closure rates falling to 16% in the U.S. Even with so many small businesses facing tough challenges in recent years, the future nonetheless looks brighter as Americans actually created 2.8 million more online microbusinesses in 202 compared to 2019. 67% of Americans are dedicated to growing their microbusinesses full-time and about 50% are focused on growth and rebuilding while about 36% say they’re still in survival mode. Since the pandemic, several small businesses had to make big changes to their business models in order to stay in business and many of those that shifted to digital plan to maintain and expand their options going forward.
Even with numerous hardships, many Americans have not been discouraged from starting their own businesses. Entrepreneurs continue to show up on the scene even during the height of the pandemic. This is possibly due to an increase in innovative thought during the COVID-19 pandemic as a result of income or job loss due to business or industry struggles. Digitally-minded entrepreneurs in particular have been able to make use of the resources they had to create businesses that were pandemic- and remote-friendly.
Thanks to the changes to the digital landscape, especially during recent years, many small businesses are getting ready to better adapt to a digital future with about 28% of them already working on doing so. This involves preparing businesses for the unexpected, but it’s easier said than done. Many small business owners are in charge of nearly every aspect of their business, including sales, hiring and onboarding, team performance, and results. As a result, more than half are scared to leave their business and go on a long vacation or take any time away from work. In fact, three in four businesses aren’t prepared for their number two to take temporary leave as well.
However, when it comes to the unexpected, success is also something most small businesses aren’t prepared for even if they foreshadow immense payoffs. More than 96% of small businesses are not prepared to handle a sudden increase in leads while more than 80% aren’t confident or feel prepared to handle a big new client. 79% admitted to not being prepared to even get 10 new clients in a single week.
Yet, if these small businesses create a complete and optimized business system, they can scale a digital business that can do well in the near future. With such a system, small businesses can track the performance in areas such as workflows, training, and metrics to identify strengths and areas of improvement. This can include creating repeatable steps to track progress, streamlining processes to run more efficiently, supporting assets so you don’t have to waste time starting from scratch every time, enabling people to perform each process to their best ability, and measuring the efficacy of the process.
Generating enough revenue can still be a challenge for many, especially with new issues on the horizon. Yet optimism still persists due to the new levels of problem-solving that were exercised at the start of the pandemic and continues to persist today. Creating a strong business system is a solution that can help many small businesses expect the unexpected while becoming profitable machines.
Written by Brian Wallace.
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