99.2% of businesses in the UK are SMEs – the other 0.8% are big brands like Tesco, for example. A portion of that 99.2% is B2B, a thriving and rapidly growing sector that’s finally finding some stability post-pandemic; but is still feeling some ripple effects of Brexit and the rise in inflation, which currently was 10.1% year-on-year in March 2023. The rapid hike in inflation rates caused issues around the globe, including for businesses that had to increase their prices and the consumers that felt the ripple effect and frantically began to find the cheapest options.
With all that in mind, and with a focus on B2B, are SMEs thriving or surviving?
The current and most relevant data and information is harrowing – four in five SMEs are struggling to plan beyond 2023. It’s a combination of post-pandemic financial crunches, the current inflation crunch, and a saturated market that’s forcing brands to consider their future. The new data comes off the back of a new intervention launched by VistaPrint, Realising the Remarkable, a £150,000 grant programme that’s working alongside Enterprise Nation to aid UK SMEs survive the economic uncertainty that’s halting growth.
Additionally, in 2022, B2B BNPL provider Hokodo carried out a survey that looked at 500 B2B brands in the UK – half of them were still struggling to survive post-pandemic. 28% of the brands admitted they were barely breaking even, with many relying on loans to stay afloat.
Still, that means that over half of B2B SME brands in the UK believe they will come out the other side of what can only be described as a turbulent and chaotic three years – it’s almost unbelievable that many have survived. Other studies confirm this almost 50/50 divide between B2B brands, with Barclays Bank also confirming that 46% were optimistic about their future.
The question is, why the 50/50 divide? Well, it comes down to the specific details of the business and the contingency plans in place. Some SMEs would have been underdeveloped and using poor business plans at the time that pandemic hit – which was when everything went downhill – and others had robust processes already in place.
Overcoming the barriers to success means understanding what’s the current key to B2B success, and McKinsey recently released an article titled ‘The Multiplier Effect. How B2B Winners Grow’. Within, and something well cited across multiple B2B growth articles, is the fact there’s no time to wait for personalisation. That could come in the form of personalised consumer incentives, in-person meetings to discuss satisfaction with products or services or a humble follow-up email. Brands want brands to go the extra mile.
McKinsey also talks about hybrid sales teams. 57% of successful B2B SMEs had remote and in-person sales teams to create an unstoppable sales force. Previous McKinsey research highlighted that two-thirds of brands wanted hybrid sales teams. So there’s still a third of brands out there who need in-person sales. The result was more substantial market share gains.
Essentially, the common pitfalls of B2B SMEs are neglecting everything you’ll find in McKinsey research – here’s the link to the most recent article. Outlined in the article are the following:
- Multiple sales channels
- A mix of sales techniques – remote, in-person, e-commerce
- Personalisation
- An easy sales cycle
McKinsey is an excellent source for B2B SMEs to understand the current market and what equals success.
The current economic climate is uncertain. It’s imperative for brands to overcome their personal barriers to success – be it opening up a new e-commerce channel, finding ways to personalise services, or getting access to grants and funding.
