It’s been a long time since Facebook was only useful for sharing family pictures. The social media platform, which now has more than 60 million small businesses on it, has just released major data about the state of entrepreneurship in South Africa with its The Future of Business Survey.
The survey which polls Facebook business page owners gives insight into the new digital and mobile economy and serves as a new source of information on small and medium businesses – including how gender management impacts their confidence also looks to provide insight into businesses’ outlooks, challenges, tactics, and demographics.
According to Facebook, to date, nearly 140,000 Facebook business Page owners, from both newer and long-standing companies, have taken the monthly survey – a 40% increase since September 2016.
The survey is a result of a global expansion of a partnership developed last year between the OECD, World Bank and Facebook and was first launched in Europe in September last year.
The Facebook survey started with 17 countries. Now they have increased the scale of the survey to include 33 countries (including South Africa) around the world (a 50% increase in countries in 3 months).
Here are major takeaways from the survey:
On business confidence
- South Africa: 50% of SMEs are positive about the current state and 73% about the future.
- On a global level and across all survey months, 18% of SMEs state that they did create jobs in the past 6 months and 39% that they want to create jobs in the next 6 months.
- South Africa: 23% of SMEs state that they did create jobs in the past 6 months and 47% that they want to create jobs in the next 6 months.
- The most common challenges for businesses are attracting customers (77%), increasing revenue (59%), and maintaining profitability (49%)
- South Africa: The most common challenges for businesses in South Africa are attracting customers (71%), maintaining profitability (53%), and increasing revenue (53%).
- The most common uses of online tools, were showing to advertise to potential new customers (75%), show products/services (75%) and providing information (65%)
- Confident businesses generally use online tools for more purposes
- 75% of respondents use online tools or platforms for at least 5 out of 6 purposes listed.
- South Africa: 82% of SMEs use online tools to advertise to potential new customers, 76% to show products/services, and 71% to provide information.
On international trade
- 17% of small businesses surveyed engage in international trade.
- This is high, considering that 85% of these businesses have fewer than 10 employees and are not large multinationals.
- OECD states less engage in international trade.
- South Africa: 15% of SMEs engage in international trade
- Small businesses engaged in international trade are more confident than non-traders.
- Small businesses that are trading internationally use online tools at a higher rate than non-traders.
- The most commonly reported challenges for small businesses engaging in international trade are:
- Finding Business Partners (60%,) Market Access Limitations (44%) and Different regulations in other countries (36%.)
- Small businesses (45%) that are engaging in international trade are more likely to increase jobs in the next 6 months, than non-traders (37%).
- There are now more than 60 million small businesses on Facebook, and more than 35% of their fans are cross-border, which is up from 30% in 2015. Approximately 65% of people in the Future of Business countries are connected to at least one SME in a foreign country.
- South Africa: 56% of people on Facebook in South Africa is connected to at least one SME in a foreign country. South Africa: 64% of people on Facebook in South Africa is connected to at least one SME in South Africa.
On women-run businesses
- Women-run businesses are as confident about their current and near-term outlooks of their business and report facing the same challenges as male-run businesses.
- Previous research shows that women face higher barriers to entry than men.
- For example, in the 2016 Women in the Workplace survey women in corporate America are hitting the glass ceiling much earlier than people think.
- Importantly, we find very little difference in confidence between women and male-run firms when asked about the present and near-term outlooks of their businesses. They also report facing the exact same challenges.
- Lean In: Confidence from a LeanIn perspective is much more at an individual level. The Future of Business survey looks at confidence in the state of the business, not the individual manager and their own skills.
- Women run business are more likely to leverage online tools to make their businesses succeed.
- Women-run businesses use digital tools for 5 of the 6 purposes included in the Future of Business survey more than male-run businesses.
- Women are 7 percentage points more likely to use online tools to show products and services, and 6 percentage points more likely to use online tools to provide information (such as opening hours and contact information).
- Typically, women are not seen as the main consumers of technology, but in fact, they are using digital more than men to run their businesses.
- As women around the world are increasingly becoming the providers for their families, digital provides a viable path for them to engage with the broader economy.
- Digital helps equalize the playing field, since businesses can reach out to customers all over the world without investing significant resources or confronting binding cultural norms.
