As small businesses gradually emerge from an unprecedented era and recover from unimaginable losses, some business owners are trying to make the best out of a grim situation. Despite the turmoil we’ve all endured, studies are beginning to show against all odds, the pandemic has created unexpected yet positive changes that might not have happened otherwise. According to a Pew Research survey, 73% of people reported to have found at least one unexpected COVID silver lining.
In the beginning of the pandemic, it was difficult for many small business owners to find even the faintest glimmers of hope. A 2020 study by the Hamilton Project found 400,000 businesses closed their doors permanently back in June 2020. Throughout history, humanity has always risen from the ashes in the darkest of times. COVID is no exception. This is why we’ve seen more small business growth recently than at any other time in recorded history. Intuit predicted in its 2021 New Business Insights report 17 million new small businesses will be formed in 2022—the third consecutive record year for entrepreneurship.
Here are some of the unexpected silver linings to the nightmares of the pandemic.
Digital transformation of small businesses accelerated
2020 was a year of reckoning for small businesses. After being blindsided by the pandemic and the lockdowns that followed, small businesses had no choice but to go virtual if they wanted to stay afloat—which meant they had to reinvent themselves overnight.
Successful businesses quickly enabled their teams to communicate, collaborate, and stay productive while working from home for the very first time. They figured out ways to reach customers without relying on in-person meetings and other techniques that were once indispensable.
They managed all this all while battling major supply chain issues and conquering seemingly insurmountable logistical challenges. To this day, 44% of these unstoppable businesses are growing at a surprising rate. Some have adapted so well to the new digital business landscape they’re even hiring.
Throughout the pandemic, online connectivity has remained an integral tool. Without high-speed internet connections, the online video meetings, document exchanges and data sharing so many businesses have come to rely on would never have been possible. Almost all (97%) small businesses surveyed say digital technology will remain important to their businesses next year.
More supply chain opportunities for local businesses
One of the biggest challenges to rise from the pandemic was keeping supply chains intact. With whole countries on lockdown, supplies dried up. Logistics and transportation, both domestic and international, became a major issue. This affected all businesses, from tiny mom and pop shops to major corporations. A survey conducted by the U.S. Census Bureau found 38.8% of U.S. small business owners reported domestic supplier delays, with the manufacturing and retail industries suffering the most.
However, against all odds, opportunities emerged. Large companies began rethinking their international procurement policies. Under pressure to bulk up their supply chains, they turned to local small businesses to bolster them and make them more reliable in the face of recent global disruptions—not just COVID-19. According to one survey, 83% of U.S. manufacturers are planning to add local suppliers to their chains within a year—a major increase from 54% in March 2020, when the pandemic first hit.
Small businesses, rev up your engines. There are countless new clients just waiting to be captured.
Small businesses adapted swiftly
When disaster struck, small businesses also showed tremendous ingenuity by changing their business models on the fly. Sit-down restaurants became deliverers of ready-to-eat meals. Outdoor dining became so popular cities closed streets—some of them permanently—to accommodate it.
Convenience took on an entirely new meaning as apps appeared by the hundreds to help us manage everything from ordering food to finding a parking spot. Of course, shopping for just about anything online became a major focus as well, and even large-ticket items like refrigerators and furniture were suddenly only a click away. Retailers shifted to being online only or switched to buy-online-pickup-in-store (BOPIS) models.
One study found from 2020 to 2021, 63% of small businesses significantly changed how they interacted with their customers. More than half (56%) were forced to reinvent their acquisitions process due to supply-chain disruptions. And almost half (46%) moved to selling online.
The common denominator in all this was technology, particularly connectivity in the form of high-speed internet that allowed e-commerce to flourish.
Innovation blossomed
Research shows many small businesses proved remarkably resilient. And some have emerged from the hardships of the early pandemic lockdowns with a bold new mindset that will serve them well in the future.
The COVID-19 pandemic inspired some small businesses to think in fresh, innovative ways. Forced into a corner, they diversified their market offerings. They introduced new products and services, and expanded into new areas of operation. Customers were eager to embrace these positive changes in their time of need.
Companies invested in, and learned to value, their employees more
The Great Resignation that began in 2021 shows no sign of abating. It led to a shortage of talent and tens of thousands of unfilled jobs across the country. And what was the top reason employees left their jobs? To seek better working conditions.
Many small businesses soon learned a difficult lesson. It was no longer easy to attract, much less retain, valuable employees. They had no choice but to raise employee salaries, throw in more perks, and otherwise put “improve employee satisfaction” at the top of their to do lists. This is good for everyone, as enhanced employee happiness is tied directly to customer satisfaction and bottom-line results. In many ways, as McKinsey notes, workers are gaining power in the workplace. In fact, the bargaining table between them and their employers is more level than it has been in decades.
Working at home has proved its worth
Before the pandemic, most employers frowned upon the idea of working from home. They suspected employees would be lazy and distracted without supervisors’ eyes on them and not perform as well as they did back in the office. If businesses did allow employees to work at home before the pandemic, the agreement was generally highly restrictive and came with all sorts of rigid rules.
As everyone knows, in 2020, the pandemic put an end to all the distrust and rigidity surrounding working from home. Additionally, the benefits for workers were enormous. No commuting, less distractions, and the ability to collaborate closely in virtual meetings were a dream come true. Productivity soared as a result. In the end, working from home was a win for both employers and employees. Although adjusting to remote work had its challenges, humanity’s ability to come together through technology and communicate digitally has worked out better than anyone could have ever predicted. As a result, remote work is here to stay for the foreseeable future.
However, equipping employees with the right technology is critical. A survey by Stanford found only 66% of Americans had internet fast enough to handle video calls. Small businesses need to work with their employees to ensure—and even pay for—sufficient technology for them to remain highly productive.
New talent pools opened up
As small businesses went remote, another benefit emerged. They could look for talent anywhere, not just in their local areas. This opened up a whole new talent pool, which is indispensable at a time when getting good help is very difficult. Today, it’s not uncommon for a San Francisco small business to have employees in Tucson or Raleigh, or a Dallas-based business to find the right people for the job in Chicago or Minneapolis.
We’re better prepared for next time
The last bit of good news to come out of the pandemic is small businesses are now more resilient than ever. Hopefully we’ll never face a crisis like COVID again. But in the event history repeats itself, small businesses will be ready. 75% of small-business owners are confident they’re better prepared to handle a crisis like COVID-19 in the future, if one ever should arise.
Make no mistake, the pandemic was a horrible catastrophe for humankind, and the losses are staggering. Business struggles may seem small in comparison to the devastating loss of family members and friends around the globe. But as with all great crises throughout history, people will inevitably adapt to the sorrow and pick up the pieces to create a better world. Many small businesses are doing exactly this by seizing the new opportunities, reinventing themselves in the process.
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