The latest American Express report, ‘Economy of Shopping Small: Keeping it in the Community’, revealed that small businesses are failing to embrace technology, and many seem oblivious to larger and online businesses that threaten their existence.
Only 38 per cent of small businesses surveyed feel under threat from large online businesses and a similar number (37 per cent) are concerned about larger bricks-and-mortar rivals. This begs the question: are small businesses complacent about the potential impact that tech-savvy large and online businesses pose?
According to American Express Vice President for Small Merchants Katrina Konstas, there is a huge opportunity for small businesses to capitalise on technological innovation to support their success.
“Small businesses need to focus on what’s important for their customers in this new digital age, and offer that unique, personalised customer service that the big end of town can’t,” she said. “If they don’t act now, there is a real risk small businesses will be left behind.
“When there is such fierce competition continually entering the market, it is a concern small business owners aren’t prioritising investment in technology to meet customer demand.”
According to the research, consumers believe that technology offers greater convenience, with the majority saying a basic website is the most important tech investment for a small business. This is followed by online sales or booking functionality and social-media channels.
By contrast, only 52 per cent of small businesses surveyed have some form of website, with 24 per cent saying they have no intention of ever getting one. On a positive note, almost half of small businesses use social-media marketing and a further 24 per cent plan to do so. Twenty-seven per cent expect to incorporate more technology into daily operations and 24 per cent are targeting increased online sales.
Owners cite funding, lack of time or technical expertise as the biggest barriers to implementation. The exception is casual and fine-dining businesses, which have embraced sites such as Deliveroo, Foodora and Menulog to introduce or widen delivery services.
The research also revealed that rising energy prices (55 per cent) and managing costs and overheads (53 per cent) are what’s weighing most heavily on the minds of small business owners this year. This differs from 2016, in which attracting and retaining customers was the number-one concern.
