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Business Management Review | Saturday, May 07, 2022
A recent survey reveals that SMEs across the continent are in survival mode.
FREMONT, CA: According to data from the EU, small and medium-sized businesses (SMEs) are the foundation of the European economy. They comprise more than half of Europe's GDP, account for 99 per cent of all firms in the Union, and employ close to 100 million people.
However, since the pandemic, SMEs have had ongoing difficulties staying afloat. SMEs are now severely impacted by rising energy prices, inflation, supply chain bottlenecks, and altered consumer behaviour after enduring the effects of the COVID crisis.
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This is especially true for the food, retail, and restaurant industries, which were among the hardest hit by the pandemic. According to a poll, which offers on-demand delivery services, European SMEs in these industries are concerned about their chances for future growth.
In Bulgaria, Italy, Poland, Portugal, Spain, Romania, and the UK, the startup polled 2,049 SMEs. Unsettlingly, 46 per cent of companies across all seven nations claim to be operating in survival mode.
This research indicates that, predictably, SMEs struggle once more as they overcome the pandemic's aftereffects.
More than two-thirds of firms surveyed in the UK and nearly half of those in Spain said they are in survival mode, which indicates that the cost of living crisis significantly impacts their brains and their balance sheets.
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The Role of Technology in Enabling Business Growth
Studies show that consumer preferences for digitalised services, such as online shopping and food delivery, have evolved significantly over the past two years.
In addition, according to Glovo's survey, 42 per cent of SMEs think that consumers' online experiences are becoming more significant than in-person interactions.
The study's example of Romania emphasises how vital technology is to corporate expansion. Nearly 1 in 3 businesses that digitised during the pandemic but ceased doing so because in-person dining has returned indicate they are now having a difficult time.
Comparatively, most companies that had previously adopted digitalisation before the pandemic and are still doing so have had sluggish but sustained growth over the last two to three years. In the upcoming 12 months, they anticipate tremendous growth as well.
Two-thirds of UK firms still claim they need assistance in becoming digitally creative. Still, relationships with private partners are only a portion of the solution, even if one-third of UK businesses consider digitalisation essential to growth.
SMEs must have access to the necessary digital skills, technology, and money to meet the ambitious goals of the EU's Digital Decade, all of which need a supportive regulatory environment.
And while several programmes and initiatives are already in place, Thierry Breton, the commissioner for the internal market, urges more action. They need to scale up efforts to ensure that every SME, company, and industry in the EU has access to the greatest digital solutions and a top-tier infrastructure for digital connections. Then and only then will startups and SMEs have a chance in the future.
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