All kinds of businesses in every industry are suffering the effects of the coronavirus pandemic and the uncertainty it has brought upon our economy. At a time when even many larger businesses are barely managing to stay afloat, what will be the fate of small and medium businesses?
According to a report on Thailand’s Covid-19 situation by The Asia Foundation, the majority of small businesses say the primary causes of disruption have been: few or no customers due to the pandemic, government-enforced lockdowns, and insufficient capital to maintain employees and the business, among many other causes.
The challenges that SME owners face may stem mostly from a lack of resources, as the research suggested. Be it access to capital or talented people to drive the business forward, SMEs often experience crises on an economic level in a much more intense way.
To make matters worse, many SMEs were not fully prepared or equipped to shift from a physical workplace to a digital, remote work situation due to the lockdown. While remote work emerged as a major trend for all types of businesses, so did the way we reached and served our customers. This was the start of a shift in the workplace and how we manage our businesses.
Another great challenge operators may be facing is a lack of innovative business acumen that allows for experimentation and new approaches. While they may be understandably rigid because of their limited resources, this could also be a contributing factor as to why small businesses feel the effects of the economic downturn more intensely.
While there are more elements on the list of challenges that SME owners face, let’s focus today on how to survive current and new challenges. Here are some things SMEs can work on during this time of uncertainty.
First, shift the focus to the business problems you may have overlooked in the past. Every business faces challenges and comes across recurring problems every day. Whether it’s a functional or technical issue or even customer complaints that you’ve never got around to dealing with, problems are a major part of a business.
With businesses slowing down, now is the best time to look at these problems and find better, long-term solutions. Solving these problems could solve some financial constraints as well as ease the workflow for your people.
Second, we must also go on the offensive. The tactic many businesses may be using right now is to preserve financial reserves and do only the bare minimum. In short, whatever comes our way, we react. However, by doing this, you may just be wasting your resources because we don’t know for sure how long this crisis will last.
A great way for SMEs to take the offensive is to reach a new market and provide a different customer experience. While it is easier said than done, it may be fruitful for SMEs — and even larger organisations —to take this time of standstill to explore new opportunities to move forward.
Third, take advantage of what your competitors are not focusing on. By doing this, you’re expanding into markets and adopting new approaches that your competitors have not explored yet. You’ll be first on the scene of opportunity and be at the forefront in that market.
Fourth, stop relying solely on your current customers and take the opportunity to expand the market. Even in a normal situation, we cannot rely completely on the transactions of our current customers. If we want to survive change, we need to spend more time expanding our reach.
This brings us to the fifth point — explore new revenue streams. Your current business model may have worked fine in the past, but in light of the changes we’re seeing this year, it may no longer work as well. It is time to explore new approaches in the same manner as expanding market reach.
Finally, continue learning. A mistake many businesses make, even larger organisations, is that they cut back on learning and development to save costs. But during times of change, learning and development become even more crucial. The new challenges we face may not always be things we’re competent or confident enough to tackle. But with learning, we develop the skills required to face challenges and overcome them with speed.
The biggest obstacle to SMEs during this time may be their lack of resources. But without straining those resources, SMEs can still rise above the challenges and thrive through this economic downturn. Even if this time of uncertainty is causing your business to slow down, now is the time to push harder than ever.
Arinya Talerngsri is Chief Capability Officer and Managing Director at SEAC — Southeast Asia’s Lifelong Learning Center. She can be reached by email at arinya_t@seasiacenter.com or https://www.linkedin.com/in/arinya-talerngsri-53b81aa. Explore and experience our lifelong learning ecosystem today at https://www.yournextu.com
