Each year, the small business SaaS company vcita surveys small businesses to check in on what keeps them up at night. And on how much progress they are making in digital transformation.
This year’s survey of 3,139 SMBs was conducted in early December. The results show a small business community that is optimistic and accelerating its adoption of a digital business lifestyle, including the embrace of digital payments and a movement away from cash.
The pandemic posed unprecedented challenges for everyone, including the small business community,” vcita writes in its report. “However, now two years in, we wanted to see how micro and small businesses were faring and adapting their business strategies to the new norm.”
A quick note on the sample before we summarize the results. Vcita didn’t specify which countries the 3,139 survey small and micro businesses hail from. It did break them down by category and age of business.
The sample was more or less evenly distributed among business and home services, healthcare, fitness and beauty, with about 16% falling into the “other” category. It also skews toward newer businesses, with more than 54% of respondents being in business for five years or less.
The top three challenges small businesses cite in the vCita survey have a familiar ring. Though we are a bit surprised that hiring and retaining staff didn’t rank higher. After all, this has been all over the news over the past year. This may be because the sample skewed toward newer and smaller businesses, which may not have large teams to manage.
Here is how vcita reads this result.
“With restrictions on in-person meetings and word-of-mouth advertising, finding new clients and retaining existing clients became increasingly difficult. In addition, the economic strain brought on by the pandemic left even the most financially savvy struggling with cash flow management.”
We would agree. But these are also perennial small business struggles that would have surfaced even before the pandemic.
Digital Tools Adoption
The survey shows a big spike in digital tools adoption last year. And vCita attributes this, at least in part, to the pandemic forcing small businesses to adapt to a more online, contactless way of doing business.
According to the survey 96% of small businesses adding new digital tools to their operations in 2021. What’s interesting is they seem to be spending real money, and not just using the freemium version.
“They’re indicating that they’re willing to invest significant funds into these tools, with a majority saying they have paid anywhere between $100-$500 for these digital tools that are helping streamline and save their business,” vcita says in its report. “These investments in their digital transformation proves the priority digitalization has taken for small businesses this past year.”
The survey also shows that small businesses are using a large number of digital tools to run their businesses. About 60% say they use between one and three tools. And about 33% say they use between four and six.
The Road Ahead
Finally, vcita’s small business survey found that small businesses remain optimistic, despite all they’ve been through. Almost 92% of respondents described themselves as optimistic about the future.
“A majority of our respondents said they are optimistic about the future of their business and are adapting their business model post-pandemic,” vCita says in its report.