5 mins
Many of the predicted business trends in 2023 revolve around a few things. These include ways for small business owners to stay competitive and find new ways to prosper.
Here are the main trends to look out for:
Sustainability
Consumers are making conscious choices to live more sustainably. They are more likely to buy only what they need as concerns about the environment and the cost of living abound. They look to brands that are open about their ethical and environmental values. Businesses that fail to do this are falling by the wayside, particularly with products like food and clothing.
A circular economy is a key part of sustainability. Reducing waste is also important. But the challenge is ensuring your products are also affordable for money-conscious consumers.
Environmental, Social, Governance (ESG)
Actions are more powerful than words. Brands must show their ethical credentials as ethical consumer spending rises. Eco-travel and transport are particularly prominent, but people are also becoming more aware of things like ‘greenwashing’ and ‘social washing’.
ESG is likely to be a key business trend in 2023. Setting out a strategy can show you prioritise social responsibility. It is more important for larger businesses, but there are still benefits for small businesses in pursuing it.
In recent times, businesses that commit to ESG have seen their profits rise substantially. This tells investors you are reducing risks and embracing opportunities to grow. People love brands that share their values, so an ESG strategy will show everyone what you are all about.
By adopting a proactive approach to ESG, your business could also avoid the potential legal repercussions of non-compliance.
Combating Inflation
The world’s economic outlook for 2023 is not the most uplifting. Inflation and subdued economic growth look set to continue. Supply chain issues relating to global shutdowns, Brexit and the war in Ukraine are still lingering.
Companies need to combat this by improving their resilience. Limit exposure to volatile market pricing. Implement protective measures in supply chains to cope with rising costs and shortages. You should map out your entire supply chain and identify inflation risks.
From here, you can mitigate those risks. Find alternative suppliers or increase self-sufficiency and you will be better prepared to combat inflation.
Digital Transformation
The digitalisation of small businesses accelerated during the pandemic. Technology in 2023 can help small businesses navigate challenges and opportunities alike. Increase operational efficiency, improve customer experiences and boost sustainability with technology.
Of course, there are certain barriers to tech adoption like lack of expertise or budget. In 2023, things like artificial intelligence (AI) and greener data centres are likely to become more accessible. Tap into these digital trends for a competitive advantage or to simply future-proof your business.
A hybrid customer experience is important as data shows customers are returning to shopping in-store. Look for opportunities to implement tech and unify the online and offline shopping experience.
Customer Experience
Inspiring, enjoyable and engaging experiences for customers are always important, but 2023 will see that amplified. The cost of living crisis is making people more discerning about where they spend money.
With computer-generated environments, businesses have an opportunity to deliver a transformative customer experience. Things like virtual walkthroughs and product simulations could really attract customers.
Look to develop immersive customer experiences to show potential customers why they should choose you.
This is a persistent trend that is leading to companies investing in monitoring technology to ensure remote workers are being productive. Employee retention may become an issue if you are unwilling to incorporate remote or hybrid working.
E-commerce Growth
Consumers were forced to shop differently during the pandemic and this looks set to continue. The e-commerce phenomenon was already rising at pace, but it went into the stratosphere during lockdowns. This growth has slowed somewhat, but the rising trend continues. Businesses should continue to adjust marketing and sales strategies accordingly.
Certain retail categories, like electronics, home improvements and home furnishings, are particularly strong in e-commerce. But the expansion of e-commerce on many fronts means this trend is likely to be a strong one in 2023.
Customers expect easy access to e-commerce tools and an excellent experience on platforms. If you want to reap the benefits of this trend, you need to emphasise your e-commerce operations wherever possible.
Innovation
With all the disruption in the world, innovation has become crucial to maintaining last-mile delivery. This has traditionally been inefficient, costly and inflexible. But consumer demand for faster shipping times is driving innovation.
One innovative solution that is slowly taking hold is drone delivery, and this is expected to rise in the coming years. AI is also likely to play a bigger role in innovative solutions. Features like automated route organisation, intelligent utilisation of capacity and predictive analysis for delivery times are powerful tools.
For small businesses, drones and AI technology is obviously a bit of a stretch! But small businesses should be looking out for opportunities to innovate wherever possible. This will largely revolve around technology, but there may also be areas where thinking outside the box can improve operations.
Discover more about business trends in our Innovation & Sustainability Course.
