As per the Crisil report, the pandemic has pushed many small and medium enterprises towards the process of digitalisation which has resulted in boosting their sales. Before the blues of the pandemic, nearly twenty-nine percent of the small businesses surveyed by the Crisil were using the digital sales channels, says the rating agency.
Since the advent of a novel coronavirus, the number has spiked up to 53% for small enterprises and 47% among micro-enterprises as of November 2020.
Crisil director Bhushan Paresh has uttered in a media statement that many more are now saying that they would take the digital route soon to cope up with the pandemic effects. Further, it underscores the fact that increasement in the process of digitalisation enlarges the footprints of MSEs driven by online LLP registration and private limited companies, assisting them to tap new markets with improvement in the access of credit for them.
Survey of Crisil has covered 566 micro and medium enterprises with an annual turnover of Rs. 25 crores. Nearly 60% of these small businesses said that digitalisation had helped them to survive the effects of the pandemic, while the rest said that it had improved the sales.
The jewellery and gems and textile industries were the biggest beneficiaries in embracing online sales. From only thirteen percent of small manufacturers of jewellery and gems using the online sales channel before the pandemic, the proportion has now spiked to almost 55%. Textile manufacturers, too, have seen progress from 20% before the pandemic to 58% afterward with the help of digitalisation.
Adoption of online sales by the smaller enterprises.
Here is the graph by which you can see the share of small and micro firms that used the digital sales channel during the pandemic.
Among the service providers, the human resource and real estate sectors have seen higher digitalisation. Realtors were hit hardly by the effects of the pandemic primarily due to the unavailability of the migrant labour and travel limitations by the state and central government, says Manasi Kulkarni, who is associate director at the Crisil. Eventually, these players, as mentioned above, have embraced the new normal by adopting digital sales channels and partnered with online aggregators to help them with lead generation.
Here are some of the ways by which small businesses can overcome the effects of the pandemic
Seeking help from the central and state authorities to address the cash flow issues.
The pandemic is hurting even a small business that has remarkable discipline and savings. As a result of that, many small businesses have been facing severe cash flow issues, which impacts their ability to function smoothly and pay their employees. This issue can be resolved by seeking help from the central and state government to alleviate the cash flow issues.
Engaging and working with the supply chain actors.
Many small businesses had to cope with operational issues caused by supply chain disruption under the central lockdown during the pandemic. Your organization can reach out to banks, credit card companies and other lenders to enquire about their customised payment and temporary forgiveness program that can assist you to ease your debt burden during this challenging time. Your company must engage with all these entities and negotiate new terms that might contain extended accounts payable terms and a reduced payment.
Being innovative while serving customers.
Under the tough times, many businesses have found their way by which they can survive. One of the primary ways to serve customers is to sell them virtually for their safety. Retailers and restaurants of all kinds have embraced this strategy by providing online services along with curb-side pickup and delivery. Whatever your business nature might be, the primary focus has to be on developing most aspects of your business to serve customers via virtual methods which includes leveraging the advantages of e-invoicing in the post covid world. This should include buying and deploying tools required for these virtual services and offering proper training for your employees to utilise them.
Engaging with your customers regularly.
One of the most crucial things to practice during a pandemic is excellent communication with your customers. Your company should utilise emails and a website to let your customers know that you are still in the business and you would continue to serve them well. Also, you should ensure to emphasize that you comprehend their health anxieties originating from the novel coronavirus and that you have adopted your interactive customer services accordingly. Lastly, you should also make a point of understanding their financial difficulties by providing occasional deals for particular services and products.
