UK Businesses Preparing for Sales to Get Worse Before They Get Better, Survey Shows
November 24 2022 - 4:55AM
Business Wire
New research from Payoneer shows almost half (41%) of
surveyed UK e-commerce businesses are preparing for a
downturn
Payoneer (NASDAQ: PAYO), the commerce technology company
powering payments and growth for the new global economy, published
today findings from its UK e-commerce study. Responses reveal some
of the biggest issues UK businesses are currently facing.
Following the UK Government's Autumn statement, which set out a
raft of new measures aimed at protecting small businesses in the
UK, Payoneer’s study details issues including Brexit, COVID-19 and
the cost-of-living crisis. Findings show that the uncertain
economic landscape, coupled with skill shortages across the job
market, are having a huge impact on the UK economy. Crucially,
Payoneer’s latest study highlights some of the ways that SMBs are
looking to combat these issues. Key findings include:
- Almost half (41%) of the surveyed businesses say they only
expect business to get more difficult over the next 12 months
- 64% of businesses say they expect economic uncertainty to be
the biggest threat or challenge to their business over the next 12
months
- Over two thirds (68%) cite decreased sales as a direct
consequence of Brexit
- Over half (53%) of respondents say they view the rising cost of
living as a barrier to investing more to expand sales abroad
In addition to some of these key challenges, retaining and
recruiting staff is another area of difficulty for UK SMBs with
over a third (34%) saying Brexit has had an even bigger impact on
this than the pandemic itself. The UK’s rising economic inactivity
rate was also on the agenda last week with Work and Pensions
secretary, Mel Stride, tasked with tackling the number of workers
dropping out of the job market. Alongside staffing issues, the
cost-of-living crisis looms large, with 62% saying inflationary
pressures will be their biggest threat over the next year.
Chancellor Jeremy Hunt confirmed in his Autumn statement that the
UK inflation rate is predicted to be 9.1% this year and 7.4% in
2023.
To combat these challenges, 46% of survey respondents are now
looking at direct-to-consumer (DTC) sales as the biggest
opportunity for their business in the next 12 months, with 38%
looking to social commerce. Not content with only finding new
places to sell, over half (58%) say they will look to provide new
deals and offers to consumers, as well as freezing prices (31%),
over the next 12 months as they increasingly look for other ways to
survive. Almost 1 in 10 (7%) are looking to the metaverse.
Despite the gloomy outlook for many, reasons for cautious
optimism were also found. With less of a focus on brick-and-mortar
business, and in line with earlier findings around DTC sales,
almost two thirds (62%) say they’re likely to grow their online
presence in the next year. Fortunately for many, the government
also announced last week that it would not be proceeding with
introducing an Online Sales Tax. By extending their online
presence, businesses are able to reach more customers across
borders and over a third (36%) say they’re looking to enter new
markets over the next 12 months. Specifically, decreased sales in
Europe has led some businesses to progress other global
opportunities, with 15% looking to North America and 9% to
Asia.
James Allum, Senior Vice-President of Payoneer in Europe,
commented on the findings: “The consequences of unforeseen
consecutive external events have been devastating for so many and a
massive challenge for global commerce. Fortunately, the
digitalisation of commerce means that now more than ever, UK
businesses can participate in a global economy and tap into
previously unavailable opportunities. We hope these opportunities
will be pivotal as businesses fight to overcome all these
hurdles.”
Payoneer’s full report can be found here.
About the research
In September 2022, Payoneer surveyed 130 small and medium-sized
businesses (SMBs) in the retail sector in the UK that sell online
and export abroad, on marketplaces or direct-to-consumer (D2C) to
identify the impact of macro events, like the economic downturn,
Brexit or the pandemic, on UK e-commerce and how businesses are
affected by these.
About Payoneer
Payoneer is the world's go-to partner for digital commerce,
everywhere. From borderless payments to boundless growth, Payoneer
promises any business, in any market, the technology, connections
and confidence to participate and flourish in the new global
economy.
Since 2005, Payoneer has been imagining and engineering a truly
global ecosystem so the entire world can realize its potential.
Powering growth for customers ranging from aspiring entrepreneurs
in emerging markets to the world's leading digital brands like
Airbnb, Amazon, Google, Upwork, and Walmart, Payoneer offers a
universe of opportunities, open to you.
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Media Irina Marciano PR@Payoneer.com
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