Facebook today released its 'State of Small Business Report', based on the 'Future of Business Survey'-an ongoing collaborative effort conducted alongside the World Bank and the Organisation for Economic Co-operation and Development (OECD).
Over the past six months, over 150,000 small businesses around the globe have been surveyed as part of the effort to distill insights into the true impact of COVID-19 on the owners of small- to medium-sized businesses (SMBs).
Among its key findings is that consumer-facing small businesses, including those in the travel and tourism sector, had endured the deepest levels of reduced sales across all six waves of the survey.
At the time of the Wave VI survey, 63 percent of small- and medium-sized businesses (SMBs) reported lower sales volumes compared with the same 30-day period last year. That's a drop of 13 percentage points in year-of-year sales than they were experiencing during Wave I of the study. SMBs also reported decreased manufacturing (59 percent), and transportation and logistics (58 percent).
Consistent with trends in sales and closure rates, consumer-facing sectors, like hotels, cafes and restaurants, also remain the most insecure about what the coming months will bring. At the time of the Wave VI survey, 52 percent cited a lack of consumer demand as a future challenge, while 40 percent primarily brought up cash-flow concerns. These observations align with external evidence that points to the difficulties facing businesses that rely on in-person transactions.
A bit of heartening news is that closure rates for hotels, cafes and restaurants went down by 15 percentage points between Waves I and VI of the study, falling from 32 percent to 17 percent over the six-month period from May to October. In this sector, a substantial portion of SMBs referenced certain community restrictions-such as stay-at-home orders (46 percent), workplace closures (43 percent) and limitations on the size of gatherings (40 percent) heavily impacted their businesses.
Looking at SMBs across all sectors, the study found that optimism and positive feelings about the future held among business leaders increased incrementally from one survey wave to the next. By Wave VI, 56 percent of respondents described themselves as 'optimistic' or 'very optimistic' about their business' future, up from 54 percent in Wave I. Except in the region of Europe, the Middle East and Africa (EMEA), where the percentage actually decreased.
One odd positive outcome of the COVID-19 crisis may ultimately be that SMBs are broadening their business' reach through use of digital technologies and online marketplaces, which has helped many to mitigate the losses they've sustained in terms of traditional storefront transactions. At the time of the Wave VI survey, 26 percent of SMBs reported that their proportion of their sales has increased in comparison to pre-pandemic times.
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