A new survey of small to medium size business (SMB) owners conducted by the Electronic Transactions Association (ETA) and The Strawhecker Group (TSG) released today found that eight in ten small and medium businesses (SMBs) that were closed at some point during the COVID-19 pandemic have reopened in some capacity. The survey also found that the majority of SMBs (55 percent) are optimistic about their business’s recovery, with retail merchants being the most optimistic vertical surveyed.
Overall, sixty-one percent of SMBs surveyed reported that they were closed in some way during the pandemic. Of the four out of ten that did not close due to the pandemic, more of these SMBs are now reporting being open without restrictions when compared to March through May. However, the vast majority of these SMBs – 77 percent – are now open and operating with restrictions like mask requirements and social distancing.
How Consumers Are Paying During COVID-19
The survey also found that during the pandemic the ways in which consumers are paying for goods and services have shifted. Close to 40 percent of SMBs have seen an increase in eCommerce sales, and the majority of these SMBs have seen increases in eCommerce sales of 10 percent or more. Further, SMBs reported increased requests for contactless payments. Of the SMBs that accept debit and credit card payments, 48 percent have seen an increase in customers using or asking for contactless payments. In an earlier report from ETA and TSG released in March 2020, only 27 percent of SMBs had reported an increase in contactless payments usage.
“It’s clear that the ‘new normal’ for businesses of all sizes is defined in part by a shift in consumer preference for eCommerce and contactless payments, which can help limit consumer exposure and promote social distancing during the pandemic,” said Jodie Kelley, CEO of ETA. “We are glad to see such a strong number of SMBs reopening, and we are proud that the payments industry has been an important partner in helping them doing so.”
How SMBs are Stabilizing Sales During the Pandemic
Over half (55 percent) of SMBs are implementing new processes or strategies to stabilize sales that were not used pre-pandemic, including adding new services/products, diversifying or adding new sales channels, and increasing marketing efforts.
Additionally, the survey found that 64 percent of SMBs have implemented or added a new or additional sales channel or tactics. With 52 percent of these SMBs levering eCommerce/online solutions and 50 percent of these SMBs leveraging a delivery or mobile service, it is no surprise that eCommerce and mobile delivery have played a vital role in the health of many SMBs.
It was also determined that Shopify, eBay, Amazon, and DoorDash were the most popular eCommerce/delivery platforms used by SMB merchants in the survey.
“Our survey found that SMBs are implementing new marketing strategies to meet customer demand in a safe and sustainable way,” said Mike Strawhecker, President at The Strawhecker Group. “Diversifying sales channels through payments technology is a key part of that.”
Between June 12 and June 18, 2020, TSG and the ETA surveyed 173 small to medium-sized businesses (SMBs) in the U.S., with the goal of understanding how the COVID-19 pandemic is currently impacting U.S. SMBs’ operations and payments acceptance, as the country has started reopening. All results are from the perspective of an SMB owner or manager. The survey represents SMBs across various U.S. regions and industries. The margin of error is +/- 6% at a 90% confidence level.