Survey: Covid taught small business owners to survive

Two thirds of small business owners say that increased costs have so far not had a negative effect on their sales. Of the businesses surveyed, 59% say the impact of increased energy and fuel costs is evident in their business.

Of small business owners, 60% do not consider recent changes in their operating environments to have had a negative effect on their businesses’ sales. When it comes to profitability, just over half of small business owners (53%) are of the same opinion.

These are the results of a survey, entitled “Menesty yrittäjänä” (“Succeed as a business owner”), conducted by the pension provider Elo and Suomen Yrittäjät, which was answered by 1,592 business decision makers in September and October.

Katja Ekman, Development Manager at Elo, thinks the results show that the Covid pandemic taught business owners to live with change.

“Covid put business owners in a new situation. They had to become more agile and able to change along with their environment. The pandemic brought a great deal of resilience out of this group,” Ekman says.

Retail sector foresees decline

Of the small business owners surveyed, 59% say increased costs have affected their businesses’ operations during the last two years. The effects of the Covid pandemic have been felt by 45% of respondents, with inflation having an impact on 39%.

“Inflation leads to rising prices, and that increases turnover, so sales figures grow, even if the quantity of goods being sold is no more than before,” says Petri Malinen, an economist at Suomen Yrittäjät.

In spite of higher costs, 37% of small business owners think sales will improve this financial year compared to the last one. By contrast, 29% of small business owners foresee a drop in sales this financial year. The retail trade, in particular, foresees a decline in sales: 36% of respondents in this sector think sales will decline a lot or to a certain extent this financial year.

“The outlook for retail is darkened by consumers’ weaker forecasts for both their personal finances and the Finnish economy. We’re particularly seeing this in consumer durables, where consumers have record low spending intentions,” says Malinen.

Development of skills as a way to respond to changes

The most common way for small business owners to respond to a changing operating environment has been to develop their own skills. Thirty-nine per cent say they are investing in their own training. Twenty-seven per cent have developed their networks and one fifth have developed their own business. This is particularly the case among small businesses working with industry, 41% of whom say they have launched new services or products.

“Businesses have clearly understood the importance of skills. In my own role, I see that businesses are managing skills strategically, developing them as a whole and taking steps in line with the business’s needs and goals. These actions develop the business’s resilience, renewability and the owners’ and employees’ work capacity,” Katja Ekman says.

The Succeed as an Entrepreneur survey was conducted online between 14 September and 17 October 2022. A total of 1,592 business decision makers responded to the survey. The respondents represent a range of sectors across Finland. Of the respondents, 55% are single-person business owners. The survey was conducted by Aula Research Oy on behalf of pension provider Elo and Suomen Yrittäjät, the Finnish SME association.

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