Follow the customer: how to repair businesses post-pandemic

Updated: March 29, 2022 at 1:36 pm
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    Customers are increasingly doing their shopping online. Daire Burke, Head of Canada at Swoop, says that eCommerce has to be done well to work

    AUTHOR: Daire Burke, Head of Canada at Swoop

    Canada’s Small- and Medium-sized Enterprises (SMEs) have always been able to take on their larger competitors by building stronger relationships with their customers. But over the last two years, opportunities to meet face-to-face have been curtailed – often at short notice. The business world has also shifted, with many now recognising the importance of internal relationships with employees as a vital part of building a successful enterprise. There is a dynamic relationship between the people that supply the money for the operation (customers) and those carrying out those operations (employees). In an unpredictable world, what can Canada’s SMEs do to deepen trust with both customers and employees?

    The sustainability factor

    Employee and customer expectations are shifting, especially around sustainability, so businesses that live by their green credentials will find themselves inching ahead. The stats all point to customers preferring to spend their money locally rather than going to Amazon, possibly because they can see their local shops struggling and realising they have to use it or lose it. Also, I don’t know anyone who hasn’t opened an Amazon package and found that it is preposterously over-wrapped. Research bears this out: as of August 2021, 40 percent of consumers were still making an increased effort to shop small and shop local as businesses reopened and pandemic restrictions eased, according to NerdWallet. With supply chain issues being felt across the globe, customers have felt an upward pressure on both delivery timeframes and costs, making the option to purchase online and collect in person key to drawing in more customers post-pandemic.

    Sustainability is also vital to businesses that wish to raise funds, with many banks considering Environment, Society and Governance (ESG) factors in their decision on whether or not to lend. In the UK, Starling Bank is refusing loans to any business that does not meet minimum standards, a policy which I expect to see roll out in different countries and with ever-higher criteria for borrowers to achieve.

    Sustainability is important to customers and employees; it will increasingly become important to the financial gatekeepers who will give your business the funds it needs to grow. Sustainability principles should be the focus of building back – think local and efficient – rather than tacked on as an afterthought. Customers are attracted to authenticity, so this is not something you can cheat on. 

    Online marketplaces and workspaces

    SMEs need to make the best possible use of the opportunities presented by digital technologies and ensure they have tech infrastructure for eCommerce and internal communications. Those two strands are very important for SMEs and are available on all budgets. Anyone can have a Shopify or Zoom. There are tools available for the smallest businesses with the most modest budgets.

    Businesses that think they can do without are fooling themselves: according to a study by IDC, at least 20 percent of small businesses globally will cease operations by 2025 if they don’t digitise fast enough.

    The rewards are there for the taking: embedded finance becoming more visible to small businesses and allowing them to offer their products more easily online. Customers are now frequently being offered various finance solutions via APIs in everyday scenarios. These range from in-app payment solutions via stripe etc., BNPL (Buy Now Pay Later) services on eCommerce sites which bolster conversion, Invoice and receivables financing available to users within their accounting software applications which can boost cashflow for SMEs.

    One thing that SMEs can do is to get expert help on unfamiliar technology. If you’re used to bricks and mortar, the online world is not necessarily the most intuitive place. 

    One of the most important things to do is to use software to gather data on how customers experience your site, analyse how long they spend on a page and figure out why they drop off. Low- and zero-cost software options for small businesses can provide this feedback and give you insights on which levers to pull to improve your customer experience.

    Hybrid working is now a reality for most businesses with employees expecting to be remote working for at least two days per week. It is incumbent on businesses to create an environment in which remote working is normalised and that requires investment in communication and cloud technologies such as Slack, Microsoft Teams and all the other platforms we have grown used to. These environments actually flatten hierarchies and make people at every level of the business feel more accountable. 

    Paying for the changes

    Swoop finds businesses the funding they need across grants, finance and equity to put these changes into place and build back their companies to take advantage of the opportunities offered by the new landscape. Canadian businesses have a number of options open to them when it comes to finding the funding they need to digitise and rebuild post-pandemic. 

    Covid relief funding (including CEBA repayment extension) will offer some support to the 900k businesses which availed of the programme but this will not be sufficient for a significant number of Canadian SMEs. 

    Alternative sources of finance and non-bank lending will play a major role in keeping many of these businesses solvent over the coming year especially where traditional bank lending may not be an option for those businesses who have weakened balance sheets as a result of the pandemic.

    As Business News Daily has observed, banks pulled back on business loans amid COVID-19, tightening lending criteria and even halting traditional loans to focus on Paycheck Protection Program loans.

    But things are changing and investors are hungry to get back to the kind of growth they can only get through nurturing SMEs: small business loan approval rates are likely to begin rising as the economy and consumer spending rebound. In particular, regional credit unions and nonbank lenders will be among the first to offer help to Canada’s SMEs. In any case, Swoop is the best place to start figuring out your options as a business owner. 

    Take your customers with you

    In a previous blog, I said that the ‘if you build it, they will come’ mentality was fatal to a business’s chances of survival. There is no reason why, however, a business that has gone out to find their customer and built a relationship cannot then take those customers with them. 

    The importance of customer service cannot be overstressed. Customers need to be in the loop and their expectations managed. 

    Amid the supply chain crunch, inflation and labor shortage, what business owners can provide customers in 2022 won’t look the same as what they provided in 2019. Customers may be coming around on longer shipping times, smaller product lines and maybe even higher prices, but it’s important to communicate those changes clearly as we move toward some kind of new normal. SMEs need to set realistic expectations by talking with your customers — in person, on your website and on social media channels — about the challenges your business is facing and how they may affect the shopping experience.

    You may just find that the honest approach, in a forum that meets the customer on their own terms is exactly what your business needs to win their loyalty – and their spend. 

    Swoop helps SMEs access the funding they need across grants, finance and equity as well as making it easy to find and switch to money-saving deals on products such as business bank accounts, FX and energy. Register now to access the best deals on the market and start making your money work smarter.

    Don’t waste time, there’s plenty of funding and saving solutions to help your business grow

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