The future for small business

The trends such as an aging population and the development of technology will affect small business as well as everything else - since small business makes up for 97% of all companies, 70% of all workplaces and around 50% of Gross Domestic Product (GDP) - it makes sense to think through some probable scenarios.

Photo by x-ray Delta One Flickr CC

Business eco-system

Business owners are no different from other people, they grow older to. In Europe the population is aging which means that there are less young to take over small business - prices should fall and many opportunities arise. The situation outside the big metropolitan areas could become rather dramatic.

Trends like these make up the business eco-system, to act on the situation can be seen as CSR and at the very least represents Leadership.

The World Economic Forum in Davos

On the blog of the Open Forum, Anita Campbell talks about small business trends, based on the Intuit 2020 Report: 20 Trends That Will Shape the Next Decade.

These are the main trends mentioned by Mrs Campbell, the comments are mine:

• Small businesses will get ever more specialized. Joining a group of specialists around an opportunity is typical start-up behavior but risky since there is much basic business competence that get overlooked. If good support structures for micro-companies can be developed specialization seems likely.


• Startup will get easier and cheaper. All Governments seem to look at Startups and Entrepreneurship as the solution to the bad economy. It is true that Entrepreneurs appear due to opportunity as well as necessity and that the number of new companies are increasing all over the world. Laws and procedures are already becoming easier, simplification is a necessity, if not the entrepreneurs will just start anyway, but outside the law. In OECD around 20% of business belongs to the "informal" sector, in many other areas it is double or triple that.


• Big and small firms will join forces. The model of congregating around orders is very effective and a rapid way of adapting, still not easy but with increased focus on cooperation and the trust in society on the rise (see crowd-sourcing), it could well be true.


• The Web and mobile technologies will become the great equalizer of big and small, with customers no longer knowing – or even caring – about the size of the firm that provides their goods and services. Trust is the issue, if there are ways of knowing the people behind the company, size probably will not matter.


• The hardware and software we use on a daily basis will get smarter, helping people make everyday decisions and streamline complex tasks. I think that especially social cooperation will continue to be facilitated through technology. To buy on ebay and Amazon is easy and dependable, if that can be coupled with better decision making small business should improve.
  
  To explain a little bit more: If we accept that business is about investing resources to gain a financial return, where you put your resources is crucial. If the alternatives could be acquired as easily as buying a computer or machine on ebay and Amazon, and if you could get support in the business making - small business could become much more productive.

What do you think about my comments to the trends? Seem possible?

Comments

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