JEDDAH: Saudi small businesses have persevered through the economic challenges posed by the coronavirus pandemic, with owners reporting that an increasing amount of their sales have moved online.
In a collaborative effort between Facebook, the World Bank and the Organization for Economic Co-operation and Development (OECD), a survey was conducted to determine how the pandemic has affected small businesses in the months up to October 2020.
“We saw this shift represented by a significant number of SMBs (small and medium businesses) in our region, which reported an increase of 25 percent or more in digital sales,” said Ramez Shehadi, Facebook MENA’s managing director.
“Though the path to recovery remains unseen, what is for certain is that small businesses have shown a sense of resilience and a propensity to think outside of the box in finding new ways to reach customers.”
With 200 million businesses utilizing Facebook services to promote their goods and services and build up an online community, social media has proven even more essential to SMBs during the crisis.
“At Facebook, we have made it our priority to facilitate (SMBs’) access to the tools they need to navigate their transition to the digital space since the early days of the pandemic,” Shehadi said.
The survey questioned 25,000 participants in 50 countries in the Middle East and North Africa, including owners, managers and employees. The results were mixed for small companies in the region. The survey found that 56 percent of companies in the UAE, 38 percent in Saudi Arabia and 61 percent in Egypt said their sales were down compared to the same period last year.
Forty-five percent of those in the UAE, 29 percent in Saudi Arabia and 45 percent in Egypt said they had to reduce the number of employees during October.
On the positive side, the pandemic has forced companies to accelerate their digitalization. Forty-seven percent of small companies in the UAE, 37 percent in Saudi Arabia and 38 percent in Egypt reported that 25 percent of their sales came from online purchases in the last month.
Looking to the future, 37 percent of respondents in the UAE, 26 percent in Saudi Arabia and 28 percent in Egypt said cash flow will be a challenge for them in the months ahead.
Despite these struggles, 72 percent of those in the UAE, 58 percent in Saudi Arabia and 56 percent in Egypt said they remain optimistic about the future of their businesses.