Small business closures are up around the world, according to Facebook’s most recent Global State of Small Business Report, and are approaching the peak of last May.
Some 25 percent of respondents said their businesses were closed, compared to 16 percent in October — and very near the 29 percent seen last May. Facebook surveyed 35,000 small businesses leaders in 25 countries around the world.
Just over half of respondents said they were confident in being able to operate for the next six months if today’s circumstances continue. The same number said they don’t foresee, in the next six months, rehiring employees that were laid off or furloughed.
Those struggling most were women and minority-owned businesses, “a further reminder that whenever crises hit, it’s always the most vulnerable who are hit the hardest,” the report states.
Women-owned businesses were on average 6 percent more likely to be closed around the world. And in the U.S., Black, Asian-American and Hispanic-owned businesses were 6 percent more likely to report a drop in sales this year. A drop that for many was significant: nearly two-thirds of Black-owned businesses and 46 percent of Hispanic-owned businesses reported a sales drop of over 50 percent.
In Europe, which has seen several waves of lockdown measures, businesses were hit especially hard, dealing with lower sales and reduced workforces, the report noted.
On the bright side, the report added, businesses are expanding their digital offerings. Those who have seen an increase in digital sales are more likely to see an overall sales increase. Facebook offers a suite of online tools for small and medium-sized businesses (SMBs), such as the recently rolled Facebook Business Suite.
According to a recent PYMNTS report, digital has saved the day for many SMBs.
“Forty-seven percent of the Main Street Survivors that sell via digital platforms say those sales have increased since the pandemic began,” according to the report. “Website sales are in second place, with 44 percent of Main Street Survivors saying the sales made on their websites have grown since the pandemic began.”
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