As we begin 2022, it’s a nice time for small business owners to reflect on all of their successes and challenges, as well as look ahead to future opportunities. Over the last several years, business owners have had to make major shifts in the way they operate, serve customers, and cultivate relationships within their community, with their vendors and partners. And the reality is, small business owners will continue to face an uphill battle as COVID-19 challenges continue.
A record proportion of small business owners report they continue to have an extremely hard time hiring the workers they need to operate their businesses. In fact, according to National Federation of Independent Business’s (NFIB) monthly survey, 56% (93% of those hiring or trying to hire) of owners reported few or no qualified applicants for the positions they were trying to fill. Headlines about the new Omicron variant will also likely make hiring even tougher in early 2022. And, business owners will continue to experience the aftermath from supply chain constraints, lower profits, and increases in material prices.
But, often the biggest challenges for small businesses are also the greatest opportunities. Below are some tips to help prepare your small businesses for success in 2022.
If there was one glaring lesson business owners learned from COVID-19, it was to be flexible. With COVID-19 impacts, businesses had to revamp their online offerings and create a digital, ecommerce presence. Most had to change relationships with supply chains and vendors or reduce hiring. When it comes to business planning for the next six, 12 or even 18 months, one thing is certain: flexibility will be key. Between staffing demands, supply chain delays and rising costs, write your 2022 plans in pencil. It will be important to stay connected with your business banker, tax advisor, accountant, and local chambers of commerce to stay on top of trends and developments that could impact your business. Most importantly, be nimble and open-minded to pivot, using your experiences over the past 18 months as a guide.
Digital payment processing
Cash flow is the lifeblood of businesses, but manually handling, processing, and dealing with cash, checks, and money orders can be costly and time-consuming. According to a report published by Wells Fargo in December 2020, a fifth of consumers made their first contactless payment during the pandemic, and more than half of them will keep using that payment method, per the National Retail Federation. The retail trade association also found that roughly two-thirds of retailers are now accepting some type of contactless payment to accommodate consumer preference as of last year. To gain a competitive advantage, small business should be looking at adopting technologies that can help speed up their access to working capital such as automated clearing house (ACH), accounts payable and receivable tools, and commercial cards.
Labor saving technologies
Utilizing technology to compensate for the persistent difficulty in hiring workers is also something to consider. Many business owners are investing more in labor saving technologies that help process orders, automate production and distribution and onboard and train new workers. A variety of labor saving technologies have become increasingly affordable and now is the perfect time to adapt.
Sharpened marketing efforts
To better promote your goods and services, consider investigating, investing, and optimizing digital marketing tools, including:
• Targeted email marketing, which allows you to send different information to unique groups of customers and measure the effectiveness of your messaging via open and click rates.
• Engaging social media campaigns, which emphasize consumer engagement via shares and measurement of results.
• A robust strategy for online customer reviews, including regular requests for customer feedback via pop-up surveys on your website (or in marketing emails) and timely personal follow-ups to reviews — both good and bad.
• A thorough website renovation, including updating policies and products, adding personality and branding, taking down dated or broken pages, and adding more photos of you and your friendly team.
Kick off the new year by conducting a thorough review of your current approach to marketing and begin assessing how digital improvements may fit into your strategy.
While there is no one-strategy-fits-all approach to planning for the new year, applying these tips along with what you have learned during these challenging times, can help lead your small business to a successful 2022.
Don Pearson is Wells Fargo Regional Banking Executive.