While Big Box retailers receive most of the attention during the holidays, its small businesses who some say are the “heartbeat” of the economy and help bring communities together — especially in the pandemic era.
And many are struggling to navigate the rough shoals of a supply chain crisis, and the after-effects of COVID-19.
There are 32 million small businesses in the U.S. that employ nearly 61 million workers, or about 47% of the labor force, according to the U.S. Small Business Association. And the sector is responsible for over 40% of U.S. economic output.
But with the coronavirus shutdown, many small businesses were left vulnerable and had to shutter their doors for good. From boutique retailers and other small businesses who vie for consumer mindset, the holiday season can make or break them.
And when it comes to this holiday season in particular, shopping early could be key to finding what consumers want, when they want it. With congestion at major ports dominating headlines and creating supply chain bottlenecks that are delaying deliveries, many retailers might not be fully stocked.
That will likely make it harder for customers to find what they’re looking for.
“We’ve prepared for the holidays, but at the same time you can’t anticipate that consumers are just going to like flock to the store just because there’s so much competition in the marketplace, but we do have a couple of hundred extra bottles in the event that we need to,” Jamilla Pipersburg, owner of Realm Concept Market, an organic beauty brand, said in an interview with Yahoo Finance.
Small business owners have known about the rise in the backlogs for months, and many started planning their holiday season earlier than usual.
“We also have a restock order coming in. [I’m] just trying to have enough supply to meet demand,”the small business owner said.
Pipersburg explained that suppliers warned her early in the year about potential inventory backups and supply chain issues. However, they are holding to their promises.
“For the most part, it’s like, you’re covered, we’ve got you, but you kind of have to wait a bit,” she said.
Businesses both large and small are seeing the delays, which is putting more pressure on prices. However, unlike multinational companies, small biz lacks the vast resources and redundancies to weather the storm.
“What used to be kind of like a quick turnaround is now, like you place an order and then potentially three to four weeks later they can ship out,” Pipersburg said.
Small biz ‘will go away if nobody actually shows up’
Meanwhile, shipping may be a particular point of friction for the consumer, according to the Quickbooks Commerce Small Business Shopping report by Intuit. The study found it to be the biggest challenge more than a quarter of customers who have shopped with small businesses online.
In fact, more than 80% of shoppers have experienced technical issues at least once or twice while shopping or browsing on small businesses’ websites, posing a threat to sales, the report said.
“Just having a really highly functional website is important,” Shilpa Reddy, vice president of Quickbooks Commerce at Intuit, told Yahoo Finance on Friday.
Additionally, Reddy explained that having a quality website and having transparency of the businesses’ content across all their social and online channels is crucial.
“Consumers are moving from brand loyalty towards wanting to try more small and medium businesses, which also means that they are trying online so it is really extremely critical for small businesses to be able to present on their channels,” Reddy said.
Another surprising trend: more than 90% of shoppers have said that supporting small businesses is more important than ever, blaming that the pandemic changed their consumer outlook, according to the report.
“It is totally about relatability,” Reddy said. “We have very closely seen how small businesses are so foundational to the community, so consumers are really standing there to support small businesses and help them, especially during uncertain times.”
With many restaurants, shops and other entrepreneurs still recovering from the effects of a difficult 2020, small businesses need the assistance this year more than ever.
“Small businesses will go away, if nobody actually shows up. We don’t have the extra capital to just hold on for far too long,” said Pipersburg.
Dani Romero is a reporter for Yahoo Finance. Follow her on Twitter: @daniromerotv
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