Entrepreneurship is at an all-time high post-Covid-19. In the wake of the corporate sector’s digital shift and a global e-commerce boom, it has never been easier to start an online business with the right tools at hand.
However, as more people ditch their nine-to-five and jump head first into their side hustle, the competition for entrepreneurial success in 2022 continues to rise as a result.
In fact, according to the Bureau of Labor Statistics, 20% of small businesses fail in just their first year. That number is set to rise in 2022 as competition within the e-commerce industry continues to soar.
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Online entrepreneurs in 2022 need to be prepared to hit the drawing board on their social media tactics, boost their start-up funding and improve their cyber security if they are to make it to 2023 with a profit in their pocket.
As entrepreneurs brace themselves for impact, here are some of the most significant struggles they could face in a post-pandemic playing field, and what startup leaders can do to ensure they still come out on top.
1. Social Platform Competition
With over 4.62 billion people now using at least one form of social media in 2022, it’s no surprise that smart marketers are utilising popular platforms for selling success.
However, with great popularity comes great competition. As trending platforms such as TikTok continue to catch the eye of e-commerce giants, online entrepreneurs with smaller followings will struggle to see high levels of engagement as they battle it out for demographic interaction.
In order to increase the chances of gaining social media-based conversions, online entrepreneurs need to be watching demographic trends and predicting their audience’s next move. From analytic forecasting to social listening, there are a number of strategies small business owners can use to jump ahead of their competitors.
The key here is to know your audience inside and out. As consumers become more active within the social media playing field, online entrepreneurs need to think smart and create content that appeals to their niche’s values. Studies show that Gen Z consumers are much more likely to interact with smaller brands if they offer them a personalised experience that commerce giants simply don’t have the time for.
2. Supply Chain Struggles
Did you know that nearly 40% of all small businesses have experienced at least one supply chain delay since the pandemic began?
In the wake of lockdown-based supply chain disruptions, cargo carrier demand surges and Brexit’s impact on import and export costs, online entrepreneurs within the e-commerce sector are still recovering from material shortages in 2022.
In fact, studies have shown that supply chain disruptions are accountable for up to a 62% loss in products for small business leaders as they battle to address an increase in global consumer demand.
As we move further into 2022, inflation looms and global e-commerce grows, which is set to put more online entrepreneurs in hot water as they struggle to meet demands at the same speed as larger competitors within their niche.
3. Cyber Security
As both consumers and companies move online, startup leaders may see an increase in conversions, however as online businesses open up to a global audience, they put themselves at a greater risk of cyberattacks.
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In fact, recent statistics have proved that cyberattacks have become more frequent in the wake of Covid-19’s digital shift. While the pandemic brought more online entrepreneurs than ever before, it also opened new startups up to cyber breaches like nothing we’ve ever seen.
Just under half of all small businesses reported a cyber breach in 2020, and that number is expected to rise in 2022.
“The number of UK businesses that have suffered cyber attacks has doubled in the past five years.” States a representative from IT Governance. In order to keep their online venture secure, new entrepreneurs must back up all company data and improve network security, if they want to keep out of harm’s way in 2022.
4. Credit Dips
While we have now reached the two-year mark since Covid-19 began, many online entrepreneurs are still facing financial strain as a result. With a reduced business profit and a lack of venture funding, many startups are seeing credit dips as we move further into 2022.
Coupled with inflation, financial hardships are set to get worse for new businesses on the block in 2022. With more business leaders than ever before turning to loan credit, Bad credit expert, Pete Mugleston suggests that securing any funding this year will be tough for small business ventures.
“Making multiple applications online or approaching a mainstream bank for a bad credit loan comes with the risk of being turned away,” he stated in a recent interview.
In fact, 97% of small business owners are concerned about business funding in 2022 on the back of inflation’s price rise demands. Entrepreneurs will need to go back to the funding drawing board and reanalyse their credit cycle to avoid losing money in the current climate.
5. Labour Shortages
Last but not least, labour shortages are also a hurdle that many entrepreneurs need to learn how to jump over in 2022. With employee turnover at an all-time high, small business owners are turning to gig economy to fill skill shortage gaps.
In fact, only half of the small companies plan to hire staff members in the next year after 4.3 million people quit their jobs in 2021.
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With labour shortages ahead, startups need to think smart when it comes to distributing their current workforce. Business leaders must prioritise the upskilling of existing staff members in order to save the pennies while filling skill shortages.
As the entrepreneurial market grows, smart startup leaders need to be prepared to cut back and use the resources at their fingertips.