Shuttered shops and empty tables: how Covid-19 has interrupted small businesses and our communities
Written with Ben Hart, originally published on The Skylark in June 2020
Small businesses are woven into the fabric of our society; they sit at the intersection between intimate community and bustling economy. They serve our needs, bring us together, and provide us with shared experience. But the Covid pandemic has plunged many into trouble, with no blueprint to guide them towards recovery.
All businesses serve the needs of consumers and customers — those that don’t tend to disappear pretty quickly. But we believe that small businesses have a unique role to play in our society and economy; a role that can’t be filled by larger organisations. They make our local communities as unique as our fingerprints, and provide arenas for some of our most memorable interactions and experiences: the chance encounter with an old friend in the coffee shop by the station, the amazing meal in the tiny restaurant beneath your apartment where you trusted your instincts and went with the waiter’s recommendation, or your new favourite clothing brand, found nestled on the shelves at the back of the local boutique. It’s hard to imagine those events having quite the same meaning if they took place against the pallid backdrop of a Starbucks, Pizza Express or House of Fraser.
That’s not to say that big businesses are bad for consumers — far from it. There’s something reassuring about ordering the same coffee in London, Los Angeles and Lima (it even comes in the same cup), and we can all rest easy knowing that whenever a last-minute, inoffensive wedding gift for a couple we don’t know very well is required, John Lewis have got us covered. But these businesses miss the elements of chance and surprise that their smaller counterparts provide.
In their necessity to operate at scale, big businesses often fail to reflect the space and place in which they exist. Sit in any chain shop, gym or restaurant and within the hour it’s entirely possible to forget which city you are in, if not which hemisphere. Small businesses, by contrast, both make and reflect the uniqueness of their locations. They make their home in some of our most loved buildings and, when groups of these small businesses congregate, they create our most vibrant streets across the UK.
And yet, as we write this, the majority of these small businesses have had to significantly scale back, or are entirely dormant. Analysis by the ONS in May has revealed that almost two-thirds of small businesses (less than 250 employees) have seen a significant reduction in turnover vs what they would normally expect. For 23% this drop is between 20-50% but, more worryingly, over 25% of businesses have seen their turnover decrease by more than 50%. Against the already-existing backdrop of limited financial resources and low margins, the existential threat is clear. But changes in consumer needs, and the technologies to which communities have turned, also pose new and exciting opportunities for small business. So, what is to be the fate of businesses that create and reflect such vibrant communities?
This is what we’ll be exploring over the coming weeks — and to do this we will need to navigate the complex web of capital and funding, changing consumer needs and attitudes, emerging technologies and solutions, and the ways in which our communities and public spaces are being reshaped by the pandemic and policy. We’ll be bringing together some of the brilliant data and research that’s already being conducted, and adding the views and opinions we’ve developed from our experiences in consulting, technology, publishing and the public sector.
We’re writing this as the first signs of the post-Covid world start to emerge. We hope many of our thoughts and ideas will ring true in 6 months time, but we’re aware that the ground is constantly shifting. We’re optimistic about the post-Covid world for small businesses, but it’s going to take creative strategy, pragmatic policy, and maybe just a bit of luck to get us there.
