Running a small business is an ever-evolving process. With each new year, we see more innovations regarding how businesses can be run. While it may be tempting to stick to doing what has worked for your small business in the past, it’s important to consider new ideas to keep your business on the cutting edge.
Read on for our thoughts on the top small business trends for 2023.
Retro is in. Layaway has been brought into the 21st century with the increasingly popular option to buy now and pay later getting more and more popular. It wasn’t so long ago that kids were asking “what's layaway mean” but today many retailers have started partnering with apps like Sezzle, Affirm, and Afterpay to offer micro-loans to consumers, allowing them to pay for a purchase in installments.
Working with a buy now, pay later provider will likely cost a small business slightly more than a standard point-of-sale system. According to Nerdwallet, most card purchases will cost the merchant up to 3% of the sale, while buy now, pay later can cost up to 7% in fees. The provider pays the merchant the total amount the customer has committed to pay, minus the fee.
However, offering the option to buy now and pay later can be beneficial to your small business. Younger generations are the most likely to use these options, especially on luxury or high-end items, per the Nerdwallet article cited above. Having the option to pay in installments also may encourage your customers to build their shopping basket more than they normally would. If they’re on the fence about purchasing a big-ticket item, knowing that they won’t be required to pay in full on the spot could be the deciding factor.
While buy now, pay later is generally associated with retail, it’s not limited to it. The great thing about installment buying is that you can use it to fit your industry. Contractors, mechanics, and even medical offices are typically able to partner with these providers and offer an installment feature.
Although customers may prefer using credit cards, it can actually be a hassle for small business owners. Credit card payments often process slowly and generally come with a transaction fee to the merchant. These delays and processing fees can make it difficult for small businesses to preserve their cash flow.
Believe it or not, sooner or later you may find yourself asking “how can my small business accept cryptocurrency?” Cryptocurrency has the potential to cut through the issues credit cards have by offering potentially lower fees and instantaneous fund transfers. This would keep small businesses from being tied up in extensive wait times for the funds to clear. While the practice of using cryptocurrency is still new, many hope to see it become a normalized payment method for small businesses so it might be worth creating a small business crypto wallet.
While ecommerce has been successfully adopted by most major brands and businesses, small businesses have not been as quick to make that leap. Small businesses — unlike larger competitors and prestigious brands — may not have the capital and manpower to implement an online sales system with a quick turnaround. But gradually, small businesses are finding ways to bring their customer experience into the modern day.
In recent years, online sales have become crucial for retailers as in-store shopping was becoming drastically limited. Small businesses especially learned that in order to weather lockdowns and public health guidelines — and safeguard their business for the future — they needed to adapt.
Ecommerce is only becoming more relevant with each passing year and an important small business trend. Shifting your small business to a model that prioritizes ecommerce sales could help you to maximize your profits and provide a new level of convenience for your customers.
Now more than ever, consumers want to be more informed about sustainability and ethical company practices. An international study from Accenture revealed that over half of consumers are willing to pay more for more sustainable products.
The study also found that 83% of those surveyed stated it was important for companies to create more reusable and recyclable products.
Shifting focus to sustainability can seem like a daunting and potentially pricey task. However, being outspoken about your small business’s sustainability policies can actually be beneficial on multiple fronts. Not only can it help attract new customers who actively shop green, it also can reduce what your business spends on water and energy consumption.
Learning how to create an environmentally sustainable small business shows your commitment to environmentally friendly products and services, and may help set your business apart from its competitors.
Most consumers who shop online have come to expect a free shipping option. Research shows that about half of consumers will research shipping costs prior to purchase and two-thirds of consumers will abandon an online shopping cart if they see that shipping costs are too expensive. While larger companies may be able to easily foot the cost of offering a generous free shipping policy, it can be fairly cost-prohibitive for small businesses. But there’s more than one way to offer free shipping in a way that works for your business.
Ways to offer free shipping for your small business:
If you’re considering a free shipping policy for your small business, be sure to explore your options and choose what works best for you and that fits your budget.
In recent years, the popularity of subscription boxes has skyrocketed. From curated clothing boxes to meal prep kits, there’s pretty much a subscription for whatever you’re looking for. Subscriptions have increased by 500% in the past nine years and have outpaced standard businesses in growth.
Starting a subscription service for your small business could help draw in new consumers and encourage repeat customers. A periodic subscription charge may help to keep your profits steady. If you sell a product or provide a service that could translate to a subscription model, it may be something for you to consider for your small business.
If you produce and sell your own products, you might consider partnering with a fulfillment company. Amazon can help with first or third party logistics for a small business. Amazon FBA, for example, is a commonly used service for smaller sellers. FBA (fulfillment by Amazon) can help small businesses in a few ways. It moves the inventory to Amazon warehouses, freeing up space on your end. It can simplify fulfillment and returns.
As a 1st-party seller, you produce your product and sell it to Amazon wholesale. While doing so means you lose some control over how those products are sold, and lose profits by selling wholesale, your overall sales have the potential to increase as a result of the association with the Amazon brand. As a 3rd-party seller, you sell your own products, using Amazon as a portal. This allows you more control but also means you need to maintain a high-seller review average.
So while the 1st or 3rd party selling approach has its drawbacks, it can help streamline your small business and allow your brand to reach new and more diverse clientele.
If you’re selling on Amazon, you may need a general liability policy. Explore your options here.
Over the past few years, customer needs have evolved. With new stresses and hardships being faced by most consumers, they’ve grown tired of automated phone trees and generic interactions.
What people are really craving is empathy and feeling like they’re speaking with a human. This is another way you can set your small business apart from the competition. Making an effort to personalize your customer interactions – in person, on the phone, and online – will help strengthen your brand and potentially keep customers coming back.
Small businesses aren’t typically associated with new tech. There’s a pervasive idea that small businesses are old-fashioned and would prefer to stick with what they know. But small businesses are in a uniquely good position when it comes to employing new tech.
Larger companies may have the capital to update their systems and try new things, but their scale means that any change needs to be tested thoroughly before it’s put into place. Small businesses, however, have a smaller scale. Any impact resulting from the technology upgrade will probably not be as widespread or costly to implement. With fewer employees to train — and, in general, fewer people to answer to — adding new tech should generally be a quicker process to implement for small business owners.
While new tech can be anything from a new point-of-sale system to AI applications for small business, either way it can give small businesses a chance to be ahead of the curve and set themselves apart.
The pivot to short-form video is officially here. More than ever, social media is becoming a landscape that prioritizes video. Between TikTok, Instagram, YouTube, and even Facebook, videos are highly visible and shareable.
Small businesses should consider using this to their advantage. Research ways to help make your small business get views on TikTok, even if it’s with an extremely small subset of users. If they’re your customers, they’re worth targeting. Social media accounts such as these are free platforms for you to highlight your business and what it offers. Think about making product tutorials or short videos that answer frequently asked questions.
This could not only help bring in a new generation of customers, but also showcase your small business’ unique offerings and values.
After several record-setting difficult years for small businesses, 2023 could be your opportunity to breathe new life into your company. Think about ways to elevate and grow your business that will bring in new customers and keep them coming back.
After several years of working in insurance while also freelance writing, I've finally found where the two interests intersect. I'm a writer with Simply Business with an insurance processing background and a love of research.
This content is for general, informational purposes only and is not intended to provide legal, tax, accounting, or financial advice. Please obtain expert advice from industry specific professionals who may better understand your business’s needs. Read our full disclaimer
*Harborway Insurance policies are underwritten by Spinnaker Insurance Company and reinsured by Munich Re, an A+ (Superior) rated insurance carrier by AM Best. Harborway Insurance is a brand name of Harborway Insurance Agency, LLC, a licensed insurance producer in all 50 states and the District of Columbia. California license #6004217.