6 out of 10 SMEs are selling online and surviving COVID-19 -AMVO

3 out of 10 small and medium-sized companies believe that online sales could represent more than 31% of their total sales after the contingency.

In the midst of the SARSCov2 coronavirus pandemic responsible for COVID-19, the second edition of the Study on Online Sales in SMEs 2020, prepared by the Mexican Association of Online Sales (AMVO) in collaboration with GS1 Mexico, reveals that Mexican small and medium-sized enterprises (SMEs) have given greater weight to the digital sales channel, leading to the fact that today 6 out of 10 SMEs sell in e-commerce, an increase of 94.6% compared to 2019.

The study was conducted to understand the financial, operational, technological and commercial impact of SMEs (with annual turnover of less than 50 million pesos), in relation to e-commerce and the current public health contingency. 

Faced with the closure of physical stores to meet the contingency measures recommended by the authorities, many SMEs reinforced their online sales channels or resorted to this modality: 2 out of 10 SMEs started selling online after the pandemic.

The implementation of online sales for those companies that still have a traditional model is one of their main priorities in the short term. For those that already sell online, they recognize that they must strengthen this channel from the sales as well as in the communication strategy.

3 out of 10 SMEs started selling online after the pandemic

Prior to the health emergency, only 18.3% of SMEs reported that the online channel accounted for more than 31% of their total sales. Now, 31.5% consider that after the pandemic the online channel will represent more than 31% of their total sales, which reflects the importance that e-commerce has gained and the impact it will have from now on for these businesses.

Meanwhile, SMEs that do not yet sell online recognize the importance of this modality but state that they do not have the necessary tools to implement it, and there is a great ignorance of requirements, a factor that leads them to postpone their migration to the digital channel.

As a result of the current situation that companies are experiencing due to COVID-19, 83% of SMEs state that sales in general have been significantly affected; however, online sales are allowing them to increase their number of customers and sell their products. Despite not being able to match their regular sales, online sales are enabling them to survive: 59% say they have experienced growth in online sales.

Under this scenario, SMEs have sought to implement actions to cut expenses in order to cover only what is necessary, being their main concern the payment of salaries; and seek to use this time to learn new things that allow them to improve as a company, especially in digital issues. 

Other major financial problems that most SMEs have experienced are cash flow (73.2%) and delays in customer payments (63.1%). Meanwhile, they have experienced some facilities such as flexibility in the payment of debts or credits (46%) and the request for additional loans or credits (43%).

The two most common scenarios that have impacted the human capital of SMEs have been the suspension of work due to the #quédateencasa campaign (60.7%) and the reduction of working hours/flexible schedules (60.5%). Only 15% say they have had to resort to permanent staff cuts.

Finally, in the operational area, the greatest impact for almost 80% of SMEs has been the problems of low demand, while for 6 out of 10 the greatest impact has been the slowdown in production.

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