Technology protects two fifths of London firms during COVID-19 crisis
Two fifths (44%) of London’s microbusinesses would cease trading amid lockdown measures if it wasn’t for their ability to use digital services, according to a new report from Lloyds Bank and Be the Business.
The new 2020 Transformation With Tech research examines technology’s influence on business survival among the UK’s smallest firms during the COVID-19 crisis and highlights the digital skills and tech they now want and need for the future. It has found that, in London, more than a third (37%) of microbusinesses created an online presence for the first time – as they sought to keep trading through lockdown restrictions. Of those already online, more than four in ten (44%) of small local businesses say they’ve increased their online trade since the beginning of the crisis.
One local firm that’s adapted to survive is AD Chauffeurs Ltd. For owner Astero and her husband Demetrios, business dried up overnight with the start of lockdown. But she has used the disruption to her business to improve the firm’s website and online payment system, making it easier to process digital payments quickly during busy periods.
The study also found that on top of helping companies to keep trading, more than four in ten (41%) of London’s microbusinesses reported cost savings as a result of their adoption of new technologies. Almost half (47%) also credit the internet and digital technologies for helping to simplify their businesses.
While four in ten (41%) of London’s microbusinesses found the volume of technology required to keep trading stressful, more than half (52%) had also received support during the crisis to adopt new technologies from initiatives including the Lloyds Bank Academy and WeAreDigital – which provide online digital skills training across the UK.
Ed Thurman, Lloyds Banking Group Ambassador for London, said: “It’s clear to see the positive impact that digital adoption has had on London businesses during the pandemic, especially those that have taken advantage of operating online, whether that’s to help reach new customers, or to manage their finances.
“One of the ways we’re looking to bolster digital skills here in London is through the Lloyds Bank Academy. With free, hand-picked lessons on topics including marketing through social media, managing money and safety and security online, the Academy is focused on helping firms, charities and organisations to improve their digital skills and take their operations to the next level.”
Levelling up tech capabilities
Across the UK, the number of businesses prioritising digital investment has doubled over the course of the pandemic. More than half (53%) of London’s microbusinesses are now investing in digital systems, technology and skills. Many reported using digital tools and services for the first time, such as virtual meetings (20%), ecommerce (17%), social media (12%), and online financial management (12%) to keep their companies up and running. Nationally, those who were already utilising these online tools pre-pandemic are using them much more (33%) virtual meetings, (27%) ecommerce, (31%) social media and (21%) financial planning.
Nationally, at least two-thirds (66%) of those who have started using various digital services say they will continue to do so in the future. The online tools that are most likely to be continued to be used are social media (83%), online banking (83%) and virtual meetings (78%). The back office has also seen a much-needed overhaul – one in ten businesses have started using cloud software and 12% are now using analytics capabilities to better understand their customers.