A survey conducted by the Economist Intelligence Unit found small and medium-sized businesses (SMBs) around the world expect the global economy to rebound by the end of 2009 (25 percent) or mid-2010 (34 percent) and a report detailing the results of the survey, Understanding Growth Priorities of Small and Medium-Sized Businesses, noted that the top three growth challenges facing SMBs were reaching new customers, attracting and retaining talented employees, and access to cash flow. The survey was sponsored by SMB online business solutions provider Verio, Inc.
The online survey of 328 executives from midmarket companies worldwide was undertaken to understand how they are approaching business strategy during the global recession. Worldwide, 29 percent work at companies based in North America, 29 percent in Asia-Pacific, 19 percent in Western Europe, 10 percent in Eastern Europe, nine percent in the Middle East and Africa, and 5 percent in Latin America. Across all regions, local and national governments were viewed as unsupportive of respondents’ businesses. Perceived low support of SMBs was attributed to the fact that the public views large companies as more important, that there was not enough attention drawn to SMBs, and that SMBs have fewer advocates than large companies.
Finding and retaining customers is a primary means of growing a business, and it is the top challenge for firms across all regions, according to the survey. Respondents report that the biggest obstacles to business growth in the downturn include reaching new customers (58 percent), developing a healthy cashflow (47 percent) and ensuring business continuity (33 percent). At 62 percent, respondents in North America identified reaching new customers as an even bigger challenge than participants in Europe or Asia-Pacific (56 percent for both regions).
About 56 percent of respondents are actively acquiring customers through new means, such as entering new geographical markets. Fifty-four percent say their firms have increased their focus on their most profitable customers (this was the top response in Europe, at 50 percent), and roughly one-third report that their companies are varying the level of service depending on the quality of the customer.
Fifty-seven percent of respondents “agree” or “strongly agree” that technology will be critical in bringing their business out of the recession and 39 percent expect to see an increase in their company’s information technology (IT) budget once the economy improves. Yet only 20 percent plan to invest more heavily in innovative technology as a means to outpace competitors, indicating that the importance of technology lies in its ability to support other, more strategic business initiatives. Indeed, 51 percent of respondents say their technology efforts will focus on improving processes and new ways to improve their business.
“Nearly all SMBs, regardless of region or industry are focused on simply doing business better,” said GlobeTrade.com president and founder Laurel Delaney. “It’s clear that there are difficult challenges that still lie ahead, but SMBs are resilient and realize that technology plays a key role in helping them be more efficient and improve operations so they can survive in today’s economy and thrive in the long term.”