Martin Seward, Vice President and General Manager, American Express Global Commercial Services Australia and New Zealand
People don’t generally like change. We’re comfortable with what we know and don’t like dealing with uncertainty. But change is a fact of life for small business owners and, now more than ever, it pays to have a plan for dealing with it.
Expectations of change jump from the pages of American Express’ seventh annual Shop Small report – The Economy of Shopping Small: The Future of Small Business. Many small business owners in the food and dining industry are eyeing opportunities to invest in technology and planning for a more digital future.
In an increasingly digital world, and in an industry that is so reliant on reviews and word of mouth, it comes as no surprise that over a third (38 per cent) of small business owners in the food and dining industry say they have launched or become more active on social media as a growth strategy.
But planning for the future isn’t only about capitalising on growth opportunities. Every year there are small business owners who want to sell their venture, pass it on or hang up the closed sign for the final time before heading into retirement. That’s why this year’s report looks at succession planning.
This emphasises the pace of small business change, with 40 per cent of small business owners in the food and dining space predicting that they’ll no longer be running their small business within three years. Selling is the most likely exit strategy (49 per cent), followed by closure (32 per cent) and handing control to a family member (19 per cent).
And yet only about one third of the industry’s small business owners who expect to leave within five years have a detailed succession plan in place. A quarter admit to having no plan at all, most commonly because they think it’s too far into the future.
So, how much time should small business owners spend planning for the future? And how far ahead should they be looking? Our research suggests that small business owners who spend roughly about the same amount of time on future planning as they do daily operations, are significantly more likely to think they have the balance right.