In their latest Global State of Small Business Report Meta have found that SMBs are having trouble recovering post pandemic as concerns continue to rise over the challenging economy.
It’s no secret that businesses are struggling thanks to rising costs. Not only is inflation impacting the running of a business but it means consumers have a tighter grip on their spending.
When it comes to small businesses Meta’s report reveals that 19% remain closed globally. This is a slight improvement from January. The highest closure rates were in North Africa and the Middle East, where 33% of SMBs were closed. The lowest closure rate was in North America, where 18% of SMBs were closed. As a result of these headwinds, nearly a quarter of SMBs (24%) reported increasing their prices by 20% or more in the past six months.
Adapting to the challenging economy
Small businesses are still trying to innovate and adapt to economic hardship using digital tools. 51% of SMBs said they use digital tools to communicate directly with customers. They also use digital tools for other business activities: 43% use them to advertise and 36% use them to sell goods and services. Digital tools have played an outsized role in generating sales for diverse-owned businesses in particular, which is critical as the report has historically revealed these communities have faced higher closure rates.
While the economy continues to affect the trajectories of many small businesses, the majority remain cautiously optimistic about the future and their ability to continue running their business. 59% of SMBs globally reported expecting to remain in business over the next six months.