The Future of Small Businesses

Small businesses are growing at an astonishing rate in the United States.

Million small businesses in the United States.

According to the U.S. Small Business Administration, there are more than 29.6 million small businesses across the country and a large amount of new businesses are responsible for job creation that builds the economy. Consider some of the facts, figures and trends that are shaping the future of small business in America today.

Why Start a Small Business?

The future of small business is shining brightly and illuminating the nation. The idea of working for yourself, pursuing a dream and gaining financial independence causes many people of all ages, genders, and backgrounds to consider starting a business. However, many are making the decision to start a business because it is easier than ever to do so.

If an individual has a skill or talent, computer or mobile device, an idea, and access to the internet, he or she has the basic resources necessary to launch a business in the modern age. As technology becomes accessible to most, more citizens will take the leap forward.

Who is Starting Small Businesses?

There are more diverse business owners than ever in the United States. More women-owned businesses are also emerging at faster rates. The U.S. Small Business Administration reports that there are approximately 8 female-owned firms per 100 working age females. A 2018 survey stated that 45% of small business owners are minority ethnic groups. This was a drastic increase from 2015, when the number of minority business owners was at 15%. The largest increase among minority small business owners however has been the number of African American small business owners with a 400% increase in a year-over-year period between 2017 and 2018.

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Millennials that have small businesses.

The Center for Generational Kinetics reports that 30% of millennials currently have small businesses, and more than 49% of them want to start a business in the next three years. However, as more millennials are starting businesses more than they did in previous years, it is the older generations that offer surprising business statistics.

A study done by the Kauffman Foundation reports that baby boomers are deciding to start businesses instead of going into retirement. Exceptional experience, access to funding, and the fact that less barriers exist to starting a company continues to drive baby boomers into the world of business.

Best Practices for Modern Small Businesses

Whether one chooses to run a small business from a physical location or entirely online, infusing the appropriate technologies in your industry is also essential for success.

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Integrating the latest point of sale (POS) systems can help small businesses to track customer trends, offer more compatible consumer recommendations, maintain inventory, and reorder stock in a timely manner simultaneously.
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Data management systems, document management systems, and human resource information systems (HRIS) are fundamental for businesses to organize data and manage employee concerns efficiently.

Artificial intelligence is transforming businesses of every size, but small businesses that learn to use it to their advantage can forge ahead of competitors in the marketplace. With the help of A.I., small businesses are collecting data that they can use to serve customers better, save money, and innovate. Although small businesses are responsible for a massive number of new jobs available, reports that technology and software-based business models are becoming a substitute for hiring people in certain positions. In the future, robotic assistants may handle most customer service requests.

Ensuring that your business implements solid data security measures is fundamental to protect both consumer and company data.

As more small businesses began to adopt software, hardware, and operate online, protecting sensitive company data from theft is paramount. MarketWatch reported that over 1,300 major businesses reported a data breach in the last year, and small businesses must be on the lookout as they may utilize less safeguards. For this reason, setting strict data protection policies is advised, and some companies are offering mobile devices for employees to use so that sensitive data is not kept on a personal smartphone or tablet that may be lost or stolen.

Marketing Small Businesses

The push toward personalized marketing efforts is continuing to grow strong, and catering to consumer preferences is king. There are many channels that businesses utilize to reach out to customers including: telephone, email, live chat, and even social media platforms. Business News Daily suggests that unifying your branding and marketing efforts is essential to reach audiences that may be reaching out through several channels.

When small business owners can build a solid brand and a trustworthy reputation, they can attain longevity.

Trends

Many small businesses are giving their employees the opportunity to work from home. By hiring remote workers, a business can reduce overhead costs and operate using less space and equipment.

Forbes suggests that a remote workforce can lead to higher efficiency in company operations, more flexibility for employees, and result in payroll savings for positions that are not necessary for daily operations.

Forging meaningful partnerships and building relationships with both consumers and other small business is becoming commonplace, and when one partner scores it big, the other can attain higher profits as well. Maintaining a good reputation online is important as most consumers perform online research and consult reviews before deciding to deal with a small business.

Using competitive intelligence to get ahead is also prevalent with small businesses. The Harvard Business Review declares that using the information to garner valuable insights can lead to changes in perspective that may result in better actions.

Adopting what works for one company and using it to upgrade your company can lead to positive results. By investigating the websites, sales funnels, content, and decisions made by successful companies, emerging small businesses can alter their operations and strategies to achieve success and differentiate themselves to carve out a profitable niche.

Adapting to the huge consumer market logging into social media platforms daily is becoming critical for obtaining business success online.

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18-29 year-olds using social media

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30-49 year-olds using social media

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50-64 year-olds using social media

The Pew Research Center reports that 88% of 18 to 29-year-olds use any form of social media, 78% for users ages 30 to 49, and 64% who are ages 50 to 64. With billions of people who have social media accounts across the planet, social media marketing is fast becoming the preferred marketing channel to reach out and connect with potential customers and partners.

Small businesses that harness the power of social media marketing can build solid relationships, gain visibility and influence, and utilize cost effective marketing that reaches the desired target audience.

Conclusion

In the future, small business numbers are expected to continue to grow numerically and demographically as many people decide to become solopreneurs, entrepreneurs, join franchises, or own a traditional business. Mission statements are critical, and they serve as a guide to help a small business move forward. Understanding what legal and regulatory impacts may affect the future of a small business is essential for its livelihood. Due to economic challenges, many people may start their business while working at another place of employment, but they often invest in their business full-time once noticeable levels of success are obtained.

About the Author:

Brittany Waddell is a contributing writer and media specialist for Pink Coconut Boutique. She often produces content for a variety of marketing blogs.

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