The impact of the Coronavirus pandemic on small business has been well documented and in some cases disproportionate. As businesses up and down the country have struggled to stay afloat through the use of government bailout loans and the furlough scheme, tech giants have collectively added over a trillion dollars to their valuations. As Amazon took advantage of increased demand for online shopping, the company added over $600billion to its valuation alone.
This growth and the struggles of many small firms paints a bleak picture for a section of the economy that accounts for 99.9% of private sector businesses and employs over 16million people in the UK. There are, however, examples of SMEs expanding rapidly during Coronavirus and lockdown and there will be continued opportunities to do so in future.
Luke Davis, CEO and Founder of IW Capital, discusses how SMEs can compete with larger rivals:
“Small firms have always been more adaptable and nimble than larger, more established companies in terms of changing their offerings to adapt to market demand. Each seismic shift in societal or economic norms, from the 2008 financial crisis to this pandemic, creates new markets and opportunities. Whether that be in PPE, track and trace tech or online healthcare.
Working on Zoom and making introductions online has also allowed small companies to compete with larger rivals in new markets in a lot of cases. Additionally, the lack of huge offices and cumbersome overheads allows businesses to be competitive with the big firms.
Some of the companies we have invested into in the past few months are great examples of this spirit. GDPQ - an online doctor consultation service - has expanded rapidly to help the NHS cope with demand. While another of our invested companies, Transcend Packaging, have pivoted to help produce PPE and have almost doubled their workforce following our investment. ”