American Business Women’s Day is celebrated each year on September 22. This piece will explore the how digital tools have helped small business flourish and adapt in the ever-changing environment.
The numbers don’t lie – women created nearly half of new U.S. businesses for the third year in a row in 2022, compared to just 29% before the pandemic1. On American Business Women’s Day, we celebrate and recognize that women entrepreneurs are a critical force in helping power the U.S. economy. Since the pandemic, they are even more focused on increased technological advances and innovation to help protect their employees, reach their customers, and run their businesses more effectively. While there are numerous ways digital tools and advancements help small businesses, here are three major benefits.
Increased ways for customers to buy or engage with products and services
The last several years brought on a necessary increase in digital use for selling products and services since customers experienced interruptions related to in-person shopping. With consumers increasingly turning to their devices, those businesses that can deliver instant solutions – be it information, products, or services – are the ones that will likely thrive in the future.
“A digital tool that is very important to us, especially as a creative company, is social media,” said Rachel Hunter, owner of A florae, a boutique flower shop specializing in the mindful art of arranging flowers as nature intended them. “Social media is massive for my industry, and it has actually become this sense of credibility…you really have to understand how to use social media to make it work for you.” Rachel pivoted her floral shop during the pandemic, during a time when her primary revenue stream—weddings and events—came to a halt. She found success by increasing her retail inventory and selling products online.
Time saving efficiencies
Another critical aspect of small business ownership is making the most of every single minute. “When you’re wearing many different hats as a small business owner, technology can simplify your operations while connecting you to new growth opportunities,” said Administrator Isabella Casillas Guzman of the U.S. Small Business Administration (SBA). “At the SBA, we know that helping entrepreneurs adopt technology can ensure their businesses are positioned to grow and be resilient. We are working hard to provide the funding and knowledge networks necessary so more small businesses can leverage these success tools and strengthen our economy.”
Streamlining process management and leveraging the tools and resources available, like the ones provided by the Small Business Digital Alliance in their Digital Tool Library, is key when you want your business to operate efficiently. “It is also so important to hire out what is simply not your forte,” said Rachel. “If your business is already opened, or you're going to start one, you have to build in financially how you are going to cover anything you either don't want to do, or that you are really not good at.” Many businesses look to centralized platforms for key functions such as onboarding, benefits enrollment, marketing, and customer service that allow business owners to reduce paperwork, increase efficiency, and get time back to focus on core business needs.
Financial education for employers and employees
In a recent global consumer poll conducted as part of the Principal® 2023 Global Financial Inclusion Index, we found that U.S. women feel less financially included across all 25 different measures of financial inclusion surveyed. This means that we all need to focus on behavioral and educational change that not only brings more people into the financial system, but also gives them the tools and resources to plan for their financial futures. Personalization should begin by equipping people with the tools, resources and advice they need to have confidence in their financial plans.
“For me, it starts with having complete transparency of our books with my whole team – all 40 people,” said Peggy Shell, owner founder of Creative Alignments, a recruiting firm dedicated to using their recruiting work as a force for good. “They know exactly where we are. And while I share the challenges we may be going through, I also share the things available to us, our line of credit, how much we have in reserve cash, and how long I think we can wait to make big changes before we’re in an unhealthy place. While this approach may not work for everyone, it is important to me because it is a financially inclusive way to lead my team, who is ultimately responsible for the success of the business.”
Tools like Money Smart for Small Business provided by the SBA, and the Principal®Small Business page allow business owners and employees to better understand their financial situations, and provides resources for financial planning and tools for greater access. And conversations like the Leveraging technology for financial wellness webinar, which featured business owners Rachel Hunter and Peggy Shell, allow other small business owners to connect and share their insights with one another. Taking advantage of these opportunities is a great first step for business owners to help increase the financial well-being of their employees.
Employers as a trusted source
We know from our research that employees look to their employers the most for financial inclusion. And to support small business entrepreneurs and owners, public-private partnerships through organizations like the Small Business Digital Alliance allow businesses, financial institutions, and government entities to come together and increase access to digital resources in order to promote greater financial inclusion.