18 October 2023 , 15:46
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One in three Brits (34%) would rather shop at smaller, local businesses, instead of large retailers – but the cost-of-living crisis has forced almost half to turn to whichever is the cheapest option, regardless of retailer size.
For three-quarters of consumers, this has meant shopping at larger stores since the current economic crisis began – with 44% of those citing the cost of living, and trying to save money, as the main thing driving this decision.
And 38% say they simply don't have many smaller shops in their area, resulting in them opting for larger alternatives.
But over a quarter (26%), of the 1,500 adults polled, have deliberately shopped at smaller businesses during the cost-of-living crisis, regardless of the cost – with 48% keen to show their support for local business owners.
And 49% do so because they know it benefits their community – while others say that personal touches, such as a warm welcome, complimentary samples, and birthday discounts, are what sets small businesses apart.
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As such, nearly half (44%) have had to take significant steps to try and manage their finances more effectively, according to the research, commissioned by Tyl by NatWest.
More than two-thirds feel they get better customer service at smaller, local retailers (Thomas Barwick/Getty Images)It also emerged that over two-thirds (68%) of those, who have turned to larger businesses to cut costs, say they have, at some point, found themselves lacking the customer service they may have experienced in a smaller store, as they struggled to find an employee to help with a query.
But on the other hand, some of the negatives of buying from small businesses include pricey shipping costs, poor delivery experiences, and lengthy timelines to resolve disputes.
Mike Elliff, CEO at payments provider Tyl by NatWest, said: “The cost-of-living crisis has changed a lot of things, including how and where people shop.
“This means businesses need to look after their customers better than ever. Prioritising customer satisfaction is not just a good business practice, but an essential lifeline for small business growth and survival.
“Business owners have the power to greatly influence consumers, even before they have started physically or digitally looking at products and services to purchase.
“Considered and personal touches can go a long way to positively position a business, well in advance of the point of sale.
“Customer loyalty, trust, and word-of-mouth recommendations become invaluable assets, and the businesses that go above and beyond to meet their customers' needs will not only weather the storm, but emerge stronger on the other side.
“In the face of economic uncertainty, fostering meaningful relationships with customers and the community is the key to resilience and long-term success.”
The study also found 27% of consumers are more likely to shop with organisations which produce sustainable products, and put greater emphasis on ethical practices.
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However, three-quarters have now turned to larger stores - as they are better value amid the cost-of-living crisis (SWNS)A third (34%), more often than not, opt to shop with local businesses over larger retailers – whether that be online or in-store.
And while shopping at a small business can be more expensive, 26% of all shoppers have used the current economic climate as an opportunity to buy from smaller businesses – safe in the knowledge they are supporting independent suppliers.
The research, conducted via OnePoll, also found 30% always look at reviews from other shoppers before making a purchase from a small business in the first instance.
And shoppers would rather shop in-store (28%) over online (21%) – with 71% of these citing the opportunity to try before they buy, among the reasons why they prefer in-person browsing.
Nearly two-thirds (64%) favour a physical shopping experience, and 59% like to take their goods straight home with them.
Alison Edgar, UK business expert and entrepreneur, said: “When the economy is changing, it is easy for people to enter the fight, flight, or freeze zone, and hide from their problems. But actually, now is the time to make an impact.
“As a small business, you have the upper hand of being far more agile than a large organisation, and the ability to bounce back and make and embrace change throughout the business.
“If you are waiting to start or scale a business, there is no “right time”, it never comes.”
Mike Elliff, CEO at Tyl by NatWest, added: “Shopping at small businesses will keep the heart of a community beating. It not only supports the livelihood and dreams of locals, but also nurtures unique craftsmanship, fosters personal connections, and ensures that every purchase goes the extra mile.”
TOP TIPS FOR SMALL BUSINESSES TO GROW THEIR BUSINESS, AND RETAIN LOYAL CUSTOMERS:
- Try not to focus on things outside of your control, such as the state of the economy or how much people are willing to spend. Instead, remain clear on your business goals and how you react to situations, running your business the way you want to run it.
- The four biggest fears that hold us back are change, rejection, failure, and uncertainty – which running a business is wrapped up in. You need to be agile, prepared, and ready to bounce back at any time – because every day will be uncertain, but the sign of a strong business is being able to adapt to the times. Tools such as the Tyl portal can help business owners prepare and adapt, so you can plan accordingly and stay in control.
- Going above and beyond for your customers can make you stand out in the long run. This can be as simple as getting to know them better so you can welcome them personally, to little extras like offering a coffee with a haircut. In a world where people like to focus on the negatives, find a way to make them leave your businesses with a smile on their face.