SMEs in a Post-Covid World: Challenges and Opportunities
If you had told us in 2019 that we’d be facing a pandemic in two years, we’d probably laugh. But, unfortunately, it happened, and Covid-19 is not going away anytime soon.
The pandemic changed how people live, work, travel and interact. We live in a “new normal” world of social distancing, digital hangouts and masks. As customers are always online, today, businesses (especially SMEs) need to make themselves available and adjust to these changes. Otherwise, they might lose their customer base and lose out. In New Zealand, Small and Medium Enterprises (SMEs) make up a massive 97% of all firms and 28% of employmentneedless to say, SMEs matter for New Zealand’s economy.
In this post-Covid world, what advantages do SMEs have?
One is the massive and much-needed community and government support. More than half of New Zealand consumers feel proud of small businesses. They would feel a personal loss if small businesses were to close. The New Zealand Central Bank and the government also provide financial aid and cash flow support to SMEs.
Despite backing from the community and the government, the pandemic has challenged Kiwi SMEs in the following ways:
● Problems in managing cash flow
● High unemployment levels and finding skilled employees
● Difficulty in adjusting and investing in new technological innovation
● Problems in dealing with the challenging legislative landscape
While it might seem complicated for SMEs to prosper, there is a light at the end of the tunnel. The solution – Kiwi SMEs need to incorporate certain long-term resilience and stability focused strategies into their business processes. What are these strategies?
Let’s take a look.
Engaging with customers digitally
During this pandemic, no matter how much we don’t want to admit it, our computer, internet and phone usage have increased. We spend more time online; we’ve shifted more towards e-commerce, remote working, digital hangouts. In the same way, businesses should shift towards online selling and marketing. Moving into online channels, alongside traditional sales channels, is necessary.
Some strategies that SMEs use to engage with their customers digitally can be social media, newsletters, e-mails and MailChimp. They can also provide online payment options such as PayPal and focus on online (data-driven) marketing campaigns.
Use Data-driven marketing campaigns
Digital marketing is important for SMEs, as it allows businesses to target a larger audience in a way that is both measurable and cost-effective. In this highly digitalised post-Covid world, SMEs can utilise data-driven digital marketing tools, such as Search Engine Optimisation (SEO), to stay in the game and compete with their rivals. Besides SEO, content marketing and social media allow businesses to target their customers, segment their client base and create customised marketing campaigns.
For more information about marketing strategies, read our blog here.
Develop a flexible Work From Home model
With the onset of the pandemic, remote work has become very popular. Statistics show that in September 2020, four in ten employed Kiwis worked from home during the lockdowns in New Zealand.
Creating a flexible WFH model (including both in-office and remote working methods) allows SMEs to maintain long-term relationships with their employees (in the absence of face-to-face interactions), lower costs like rent and utilities, minimise the chances of getting sick and outsource global talent. The opportunities are endless!
The Bottom line
In New Zealand, the Covid-19 pandemic has challenged SMEs. On the flip side, it’s pushed SMEs to move into digitalising their business to survive in the post-Covid world. Through digitalisation, SMEs can innovate and adapt to consumer needs and trends – keeping them in the game. Also, with strong community and government support, SMEs can benefit and survive in this challenging world.
So, while things might seem gloomy for New Zealand SMEs, there is definitely hope around the corner!