4 Small Business Themes That Will Define 2021

The following post was written and/or published as a collaboration between Benzinga’s in-house sponsored content team and a financial partner of Benzinga.

Last year was a difficult one for small businesses. Not only due to the privations imposed as a result of COVID-19 lockdown and quarantine measures, but also in terms of anticipating what steps they could take in order to grow, evolve or simply survive over the course of the year.

While 2021 does not hold any promises for small businesses, we at Credibly have worked with thousands  of small businesses over the past 12 months to help finance projects to help them survive in an uncertain time.

From those projects, we’ve identified a handful of prevailing trends that will almost certainly shape the year to come. Small businesses owners that are planning their annual strategy should consider incorporating these four themes into their approach to the new year.

Government Aid

The first and currently most active theme for small businesses is government aid in the form of the Paycheck Protection Program (PPP) loans and tax relief.

The new relief bill, signed into effect in the waning days of 2020, earmarked another $325 billion toward the successful PPP, for which individual companies are eligible for up to $2 million in advantaged loan amounts. As with previous rounds of PPP loans, any borrowed funds are eligible for loan forgiveness when spent toward qualifying business expenses. However, the new bill also allows for those forgiven funds to be deducted as regular small business expenses, something the original program did not include.

In addition to another round of PPP loans, the bill also includes several tax credits that small business owners should bear in mind. These include an extension of employer tax credits for paid family and medical leave through March as well an extension of the employee retention tax credit that reduces the amount of employment tax deposit business owners are required to pay.

Online Presence

Another major theme that has only become more pronounced in this time of pandemic is the role the internet plays in driving sales and promoting awareness of a business. Ecommerce sales increased by almost one-third between 2019 and 2020 and, when excluding gas and auto sales, represents one-fifth of all retail transactions.

Of course, this trend in online sales has been a long standing one, though its recent rate of growth was entirely unexpected until the pandemic hit.

However, setting up an online storefront and bolstering your business’ shipping and logistics framework is only one component of how the sales landscape has changed. Now more than ever, small and local businesses need to have a compelling online presence to increase awareness of their products and services. This could mean working with online marketing and media organizations like Alphabet’s GOOG Google Ads or Facebook FB Ads to provide targeted marketing to their online properties. It could also mean simply maintaining a strong social media presence and responding to customers or potential customers through these channels, which is increasingly becoming the primary way in which consumers gain a sense of a business’ products, service and overall reputation.

Cloud and Cybersecurity

As more businesses move their operations online, protecting those digital assets will become critical in surviving the rapidly growing threat of cybercrime. Not only did last year see the highest volume of cybercrime activity, approaching almost $1 trillion in lost or stolen funds, but the final weeks of 2020 also saw the largest cyberattack to date waged against several U.S. government agencies.

This trend of increased scale and sophistication of cybercrime only promises to become more pronounced as a greater number of transactions and business operations move online. Small businesses are more susceptible to the existential threat of these kinds of attacks, with roughly 60% of companies forced to shut down in the months following a cyberattack.

If it’s not already a part of your annual budget, business owners should factor in a regular audit of their digital framework with the help of specialized I.T. cybersecurity contractors. Additionally, businesses should also look to cloud network providers as the cheapest and most secure way of protecting sensitive data, particularly in an age when many companies’ workforces are remote and accessing centralized networks from a variety of potentially insecure networks.

Buy Local Initiatives

Finally, in the midst of the rapid and large scale changes that have taken place over the previous 12 months, one change for the positive within the realm of small business is that consumers are more aware than ever of the importance of local businesses to their communities. As storefronts were shuttered and long-standing local institutions failed, consumers recognized that the future of their towns and cities rested on the resilience of the businesses that support them, both monetarily and culturally.

Business owners should do everything in their power to band together and increase that sense of community and economic interdependence, either through local commerce groups or through events and promotions that encourage mutual support among business owners.

Take this episode from business owners in Toronto, in which a vintage resale shop owner created an online list via Instagram for other local retailers. The list quickly grew to a directory of more than 4,000 businesses that were able to rally together and coordinate an online message that consumers avoid national brands and shop at the businesses within the group.

While 2021 may hold little in the way of certainties for small businesses or the world at large, business owners should nonetheless plan for a future of growth and prosperity. No matter what the next 12 months may bring, Credibly will remain a proud partner of small businesses looking forward to a bright future.

The preceding post was written and/or published as a collaboration between Benzinga’s in-house sponsored content team and a financial partner of Benzinga. Although the piece is not and should not be construed as editorial content, the sponsored content team works to ensure that any and all information contained within is true and accurate to the best of their knowledge and research. This content is for informational purposes only and not intended to be investing advice.