COVID-19 has been a long battle for many, and changes wrought by this crisis will constitute the “next normal”. As we remain optimistic that the pandemic situation will improve soon, here are 3 actionable tips to help prepare SMEs to boost their businesses post-pandemic.
1. Create a long-lasting digital transformation
During COVID-19, SMEs rushed to adopt technological transformations to keep their business afloat. Companies digitized many activities at rates 20 to 25 times faster than they had previously thought possible, according to a McKinsey survey. These quick fixes may not be sustainable in the long run, so SME business owners should focus on stabilizing their digital infrastructure. Research has shown that demand for e-commerce and digital channels will continue to increase after the pandemic, which highlights the growing need for businesses to digitalize their operations to handle future growth.
2. Research on alternative financing options
According to a survey by Experian, 61% of Singapore SMEs faced lower credit ratings amidst the COVID-19 pandemic. However, sustaining a stable liquidity position is vital for SMEs to navigate the pandemic and recover post-COVID. The lower credit ratings may pose a problem for SMEs to obtain financing loans from banks, so they can consider leveraging on financial loans by Fintech firms instead to maintain sufficient cash flow.
3. Plan international expansion of business
66% of companies state that ability to travel overseas is key to effective business operations based on the Singapore Business Federation National Business Survey 2020/21. With COVID restrictions lifting in various countries, it will facilitate overseas expansions since owners can be physically present for processes like agreement signing and compliance checks. SMEs should start planning for international expansion so that they can seize opportunities that arise in recovering economies (like China’s Greater Bay Asia development plan).
Technology, finance, and people are the core pillars to long-term resilience for SME businesses. As companies plan out their recovery roadmap, it is necessary to ensure that they have a solid foundation to support it.