On June 09, 2022 — 4 mins read
Two years ago, when the first lockdown was initiated, people anticipated it to end within a few weeks. Lengthened to months, small businesses were forced to update the way they did business. From a vegetable vendor to a tool machining mill owner, those who didn’t move their business online suffered loses and for those who adapted to the wave of change, survived. A study by Zinnov claims that 70% of small businesses are accelerating digitalisation to ensure business continuity during COVID-19
The digital change had been inevitable—in adoption at retail level in kirana shops, payments apps have eliminated the requirement of cash as a medium of transaction. Payrolls have gone from physical register to an app. Hundreds of pages of inventory are replaced by a simple spreadsheet. Whereas businesses that had an in-person customer base are either making themselves available on online marketplaces or are launching their online stores. Apart from surfing the pandemic wave, digitalisation provided a way to stay competitive in the new business and economic environment that requires new strategies and practices.
There is a inverted-pyramid when it comes to the level of digitalisalisation used. The digital penetration most of small businesses begins with connectivity and communication, maintaining their presence on the internet through their smartphone or PC. A step ahead is using payment and digital wallets, and their integration into the mainframe payment system of India, the UPI. The road less taken by most is following this, which leads to the discoverability of business—using social media and listing/marketplace websites. A shrinking percentage uses CRM and other enhanced accounting and management tools and followed by another minuscule percentage using sophisticated technologies for automation, that includes IoT and RPA.
But the scaling is not an easy task. 84% SMBs reported difficulties in executing their digitalisation goals cing a shortage of digital skills and adequate talent, followed by lack of funds and insight into data. Lack of advanced digital literacy prevents small business from rural India to climb the digital ladder. Business who didn’t take the leap before the pandemic said that it was because digitalisation was not a priority, then. Another greater difficulty is unavailibility of past data by business—which could potentially provide insights into future through data analytics.
But future for these businesses looks bright in India. Contribution of small and medium businesses are 39% to the Indian GDP and is expected to grow to 50% by 2024. With initiatives of government of India like Digital India and Skill India, rural dissemination of internet and skills are expected to grow.
Team Mulltiply
