Small businesses are the backbone of our economy and the soul of our communities. They make up more than 40 percent of the country’s GDP. They create about two-thirds of all new jobs and they employ nearly half of all private sector workers in the United States.
4 Ways Small Businesses Can Prepare for the Future
- Invest in HR, including retaining employees and recruiting and onboarding new ones.
- Use HR technology to save time and avoid headaches.
- Enlist AI’s help in running your business.
- Support employees 100 percent from Day One.
Despite this crucial part that they play in the health of local communities and the economy at large, small businesses continue to battle constant threats that test their survival every day. They’ve squared off against a global pandemic, subsequent forced closures and employee labor shortages and now have to deal with rising inflation and a looming consumer recession.
In the face of it all, small business owners and their unstoppable teams have shown us they’re resilient and unshakeable. But what’s in the sauce? How do they do it?
From a recent Homebase survey of 500-plus small business owners and my own personal conversations with these inspiring folks, I’ve zeroed in on three trends small businesses are facing. Spoiler alert: It’s all about your team and your tech.
Spend Smart and Invest in Your Talent
We know from our survey that despite the challenges in front of them, small business owners are optimistic about the future. How do we know this? They’re planning long-term by investing in key areas that will protect their businesses against economic uncertainty and allow them to scale to new heights. Nearly half of the respondents plan to invest in the retention of current staff, while forty-five percent plan to spend on recruiting and onboarding new employees. It might seem obvious, but a strong team means a strong business.
Learn to Love HR Technology
HR technology is another quick win that’s easy to miss. It comes as no shock that many small businesses still run their day-to-day operations and communications offline. That means paper schedules, sticky-note reminders or in some cases, verbal requests that are never captured anywhere. According to McKinsey, processing time fell sixty-six percent when HR technology was adopted into the workplace, adding convenience and freeing up time for other tasks.
But small businesses adapt, and Main Street modernizes. One in four small business owners plans on investing in HR technology or improving operational efficiency. Scheduling, time clocks, payroll, hiring, onboarding, compliance, you name it. It all gets a bit easier when you bring it online. It saves owners and managers a big headache, and it’s also appreciated by hourly workers, who value tech-savvy companies with tools that make their day-to-day jobs easier. Save on time and retain happy teams.
Strategic investments like these, in your team and HR technology, are how savvy small business owners are spurring labor force participation and setting themselves up for the future.
Embrace AI to Strengthen Your Team and Your Business
Over a quarter of small business owners want to use AI to help run their businesses. The top reason is to develop written or visual content. In 2023, many small businesses can’t afford a designer or copywriter for their website. AI is leveling the playing field. Small business owners now have ad copy, product descriptions and visual graphics at their fingertips.
Beyond developing content, small businesses are using AI in their operations. For example, Homebase’s auto-scheduling feature enables managers to quickly create reliable schedules for their hourly employees. The model accounts for availability and other factors to generate complex multi-person schedules so that managers no longer have to manually write them out.
The real value in tools like these is the cost savings, increased productivity and avoiding burnout, all of which enable small businesses and their teams to operate sustainably and scale long-term.
Support Your Workers 100 Percent
Recent data shows that 60 percent of small business owners say rising inflation, interest rates and a looming recession keep them up at night, up from fifty-six percent last year. And it doesn’t stop there. Retaining employees is a big worry for more than a third of small business owners, followed closely by recruiting new staff at thirty-three percent.
Take Brooklyn Tea, for example. Co-owners Jamila and Ali Wright have made the workplace a family unit, aiming to support their employees who in turn, give the small businesses everything they’ve got. Whether it’s attending an employee’s theater show or allowing a team member to use the shop for an open mic free of charge, these are easy, real ways Brooklyn Tea shows their employees they’re valued.
When Jamila and Ali hire talent, they aim to communicate the bigger picture of what it means to work there, creating an environment where staff feels empowered to be who are in and outside of the job. Having a solid interview process and putting effort into creating a supportive atmosphere will help small businesses find and retain the right talent.
Having a solid interview process and putting effort into creating a supportive atmosphere will help small businesses find and retain the right talent.
The pandemic transformed what success looks like. Revenue growth remains the top success indicator for small businesses. However, the next top indicator is team growth. Before the pandemic, small-business owners based success on achieving consistent results. This shift towards team-centric priorities is how small businesses are setting themselves up for success.
While the current economic moment poses a threat to small businesses, I know Main Street will come out on top. Small business owners are embracing new tech to automate and bring manual work online, investing in hardworking talent and showing appreciation for their unstoppable teams in a real way. It’s been an uphill battle for the last three years, but it’s time for small businesses to set their sights on the future.
