By Marcia Layton Turner
Flexibility. Agility. Adaptability. These values are at the heart of some of the biggest trends impacting small businesses right now. Whether they’re expressed in providing employees with a flexible work environment, investing in technology to become more agile, shifting marketing and sales activities online, or in other important ways, how companies demonstrate these values will determine who succeeds and who closes their doors in the coming years, says Professor Vanja Djuric, associate professor of practice at The University of Akron.
Another concept that will play a part in determining the long–term success of any small business? Preparedness — and that’s where small business insurance is the key. Read on for more predictions on where small businesses are heading and why business owners need small business insurance from State Farm.
The Flexible Work Environment
In this ultra-competitive labor market, with open job positions keeping so many business owners up at night, flexibility is king, according to research conducted by the Future Forum. It can make all the difference in hiring the talent needed to succeed. Ninety-three percent of employees want flexibility in when they work, 76% want flexibility in where they work, and 21% are willing to leave to get it. Because small businesses “are not always able to provide the same salary or hourly rate as the big corporation down the street,” Djuric points out, offering incentives that workers highly value, such as flexibility, is one way to become more competitive. It can make all the difference in hiring the talent needed to succeed.
In fact, 59% of knowledge workers rank flexibility as more important than compensation, reports the Jabra Hybrid Ways of Working: 2021 Global Report. That’s good news for small businesses, many of which have already adopted a remote workforce model or have no issues with allowing knowledge workers to work remotely a majority of the time. The flexible work environment is a trend that has already taken hold within small businesses.
Investing in Agility
“We are living in an unpredictable environment,” says Djuric, where “prices continue to rise, a shortage of workers still exists, and – with the Delta variant still very much present – small businesses need to continuously assess how to prepare for the unexpected. The best approach is to create a culture of agility.”
Agile organizations are, by their nature, faster, more resilient, and more adaptable. “Next year will be the year in which we see organizations investing in becoming more agile,” Djuric says. “This will provide further investments in technology, collaboration, and flexibility for employees, while ensuring a plan for success in uncertain times is stronger than ever before.”
One tool that can enable continued business agility and flexibility is small business insurance, like coverages offered by State Farm. Insurance can help reduce surprises that occur as a result of unexpected accidents or resulting lawsuits. Small businesses that can be nimble and adaptable are much more likely to survive and thrive long-term. And since State Farm agents are small business owners themselves, they’re uniquely equipped to help company owners navigate the policies they need, from liability coverage to workers' compensation.
Focusing on Customer Retention
"Although it’s common knowledge that it can cost five times more to acquire a new customer than it does to retain one," Djuric points out, "businesses typically haven’t invested as much in retention. The pandemic changed that dynamic, however. The small business owners who weathered this extended storm were those who quickly recognized the importance of working to serve their existing customers," she says.
Savvy small businesses were thoughtful about how to maintain customer relationships even as everyone was social distancing. Some of them employed innovative tactics including holding special online events, selling via live streaming, offering services by video, conducting gift card promotions, and maintaining regular communication with current customers via text and email.
Now that small businesses have seen first-hand how essential customer relationships are to success, expect a greater focus on rewarding customer loyalty.
Another small business trend that shows no sign of retreating is an increasing reliance on online sales, or ecommerce. “Even if you are a small business that doesn’t currently sell a physical product, thinking of ways in which you can cash in on this trend will be important,” Djuric says.
Supplementing product sales with ancillary offerings, such as online courses or consulting services, is one way to expand an online footprint. Affiliate marketing, where you create income by promoting other companies’ products, is another option for monetizing your digital audience.
Digital Marketing Takes Hold
“If there is one thing we saw in the last two years, it is the growth in social media usage,” Djuric says. That includes growth in social selling, micro-influencers, and social media advertising, which have all exploded as digital marketing tools.
To cash in on the trend, she says, “continuously assess your marketing efforts and think of ways in which you can prioritize your social media and email marketing efforts.”
Paying attention to these small business trends, and responding as new ones emerge, can help propel small businesses into industry leaders.
Find a local agent or visit statefarm.com/smallbusiness to start safeguarding your business today.