It has been three years since our definition of normalcy was turned on its head following the COVID-19 pandemic. The short-term impacts of the pandemic – like lockdowns and social distancing restrictions – are behind us, but businesses and consumers are now contending with the medium-to-long-term impacts such as economic headwinds and labour shortages.
For many small businesses, a key learning of the pandemic was the importance of being ready and willing to reject the notion “We have always done it this way”. Innovation, the ability to technologically pivot and reduce overhead costs were key to keeping businesses afloat during turbulent times.
The new year is well underway, and consumers are approaching post-pandemic waters with equal parts caution and optimism. There is a visible desire to dip back into the brick-and-mortar environment, as much as the rising cost of living will allow. So, how can small businesses demonstrate proactivity for the year ahead?
Here are three trends to keep on top of in 2023:
Nimble, flexible small businesses will flourish
Lockdowns demonstrated that the businesses – especially restaurants, cafes and bars – unwilling to modernise their operations were left behind by consumers and competitors. For example, the shift to online and QR code ordering continues to grow, with 27.3 per cent of Australian venues using QR codes in December 2022 compared to just 4.9 per cent in August 2020, according to Lightspeed data.
In 2023, businesses must adopt a similar level of change-agility. Cloud-based systems and automation save valuable time. This allows employees to dedicate their time to being more consumer-facing, with portable technology allowing them to focus on experiential retail and hospitality – a far cry from outdated, anchored hardware.
Consumers will continue to shop on-premise, demand for experiential retail will grow
Since realising the abilities to live, work and shop from home, consumers now seek an ROI when it comes to their time, and they expect more than a what-you-see-is-what-you-get transaction. In 2023, businesses must think outside the box when it comes to enticing customers through their doors. Westfield data has shown that 81 per cent of shoppers are willing to spend more in retail stores that offer rich shopping experiences.
Omnichannel marketing and data analysis are crucial to unearthing what products or services people are willing to purchase. Consensual consumer data collection can help unveil unnecessary costs, as well as introduce business owners to emerging trends and opportunities. For example, is it time to cut that unpopular brunch item? Time to introduce batch brew? And how can you identify, then segment, loyal customers? The decisions are in the reporting.
Small businesses will need to deal with labour shortages
Vacancies will continue to challenge small businesses as job positions become increasingly more challenging to fill. Pandemic-induced labour shortages mean that business owners must lean on in-depth reporting insights to maximise efficiency, automate and streamline operations through a consolidated tech stack. Wary of inflation and further interest rate hikes, employees are being more selective with the roles they apply for.
Businesses that automate where possible can then focus on encouraging return business and operating more cost-effectively. Systems that automate dull and repetitive employee tasks boost engagement and satisfaction – increasing both retention and motivation. Reconsidering the employee value proposition, concurrent to the appeal provided to consumers, is crucial in order to attract and retain talent.
The past few years have shown that small businesses are resilient, innovative and dynamic. Despite 2023 shaping up to be a year full of its own unique challenges and opportunities, small businesses can still find space to thrive if they are willing to integrate old-school roots with a new-school level of adaptability and technological innovation.
