The UK's small and medium-sized business owners (SMBs) ar predicting that the recession will last until Spring 2010, according to research from Amplify, which found that 43% of SMB owners wish they had placed greater emphasis on marketing while 31% wish they had cut back on staff more quickly.
According to the latest SMB Economic Indicator study, nearly half of the business owners surveyed (45%) said they have already made some redundancies in the first half of the year (33% had shed up to 10% of their workforce while 12% shed more than 10%).
Perhaps unsurprisingly, 55% said their business success is inextricably linked to the health of the wider economy. However, 26% expect their business to continue to struggle even after the wider economy begins to recover. According to Amplify, 38% of SMBs reported their worst sales in Q2 2009, compared to 26% in Q1 2009. One positive finding of the study is that 31% said that they had observed "no real fall in orders" over the past three quarters.
Of those whose orders had dropped due to the recession, 24% had seen sales fall by up to 10%, and 25% saw sales fall by 11% - 20% during the first half of 2009. Only 19% reported a drop in sales of more than 20%.
Some 38% predict that the sales decline will slow down during the next six months and 26% said they felt the downward curve would stop completely by the end of 2009. Only 5% felt that conditions would get even worse by the end of 2009.
However, SMB owners are still not good at selling and marketing their services, particularly where the internet channels are concerned, as 21% had no systems for collecting and managing records (or even staying in touch with prospects) at all. Nearly half (48%) rely on spreadsheets or home-grown databases to store and manage prospective customer records, and very few had proactive or reliable systems for keeping in touch.
In terms of marketing technologies, 43% admitted that any systems they did have were not well integrated with their email software, and that face-to-face meetings and email are their two key methods of keeping in contact with prospects. To help counter this problem, 43% said they are now investing in improving their web site, while 57% are cutting costs to increase sales, and 38% are doing more sophisticated business development work including establishing new partnerships and joint ventures.
Some 29% said that social media web sites were a good business-to-business (B2B) networking tool, while 26% felt that social media is only valuable for those selling consumer products directly. Interestingly, 19% said that they did not know how to use social media positively in their business, while 17% said that it is a "waste of time" and 10% felt that social media is merely "something which is led by kids with too much time on their hands".
According to David Holt, director of contact management for Amplify, "Although many SMB owners' experiences in this downturn are unique, there are some common threads. Firms that have read the market well are thriving despite the economic gloom, and success is also coming from getting closer to customers and seeking more feedback, more regularly, on what they want."
Holt therefore argues that any reliance on telesales, outbound email, and face-to-face meetings must be supplemented by a mixture of internet-based 'pull marketing' techniques.