The results of the latest Viking Small Business Barometer report demonstrate the time and resource pressures under which small businesses in hospitality are currently operating. For SMEs that have now been fighting for survival for years, finding the time or paying for the resource needed to be effective in social media, is a real struggle.
H and C News suspects that the report’s findings will not come as a surprise to SMEs, though it will usefully remind to check on their competitors to see if or how they have managed to engage with social media.
Reliance on word of mouth
Three quarters (72%) of small business owners in the hospitality sector say that, despite doing business in a digital age, they prefer to rely on the traditional method of ‘word of mouth’ rather than riding the wave of social media when it comes to gaining new business, according to the report.
Even more surprising is the frank admission that 28% of Managing Directors say they not only regret starting their own venture, but would not go through the pain of starting their small business if they were to do it all again. Perhaps another sign of the pressure under which they are operating?
According to the Viking Small Business Barometer report which focuses on the first three months of 2013 and the overall outlook for the year, not only do 72% of owners and Managing Directors of small businesses within hospitality depend on ‘word of mouth’, 38% continue to shun social media in favour of networking and meeting people face to face.
Business is stagnant
Furthermore, SME’s in hospitality believe that their businesses have hit a slump, with 59% revealing that business in the first quarter of 2013 has remained stagnant in comparison to the final quarter of 2012 – which is considerably higher than the national figure of 41%.
Generating additional revenues will be top of the agenda as 21%of business owners revealed it proves to be the most challenging. Improving brand awareness and increasing traffic to company websites were surprisingly low on the list of priorities (10% combined).
65% expect to grow their business
Despite the slow start to 2013, businesses still remain optimistic with 65% of SMEs across the UK expecting to grow their business and 29% forecasting an increase in their company profits over the next three to six months.
Sophie Christopher at Viking said: “The fact that business owners of SME’s remain steadfast when it comes to using ‘word of mouth’ to gain new business highlights that whilst we are all conducting business in a digital age, the fundamental way of running a business remains the same. Entrepreneurs obviously still feel that the only way to ensure your business succeeds is by acting on good recommendation, something that proves to be consistent across all sectors.”
The Viking Small Business Barometer
Is a quarterly tracker survey which speaks to the same 1000 small business owners and Managing Directors across 15 sectors in the UK every quarter, in order to understand the thoughts and outlook of the country’s small businesses, which employ 14.1 million in this country and are seen as the key to economic recovery.
Last quarter’s research revealed that 40 per cent of small businesses believed that Government policies had no positive effect on their business and, despite the announcement of the new Employment Allowance by the Chancellor, the figures still remain consistent (44%) this quarter.
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