The small business landscape is changing faster than ever before. 2024 promises to be marked by shifts in financial strategies, technological adoption, and a heightened awareness of societal needs. Check out five new business trends to anticipate so you can stay ahead in the competitive market—from innovative financing solutions to the growing importance of social commerce.
1. Less Traditional Financing, More Alternatives
Traditional financing is becoming less appealing to small businesses. 2024 stands to start out with high interest rates for businesses looking for loans—not exactly an enticing offer for entrepreneurs in need of capital.
Plus, small business loan approval percentages decreased from 13.1% in September to 13% in October, following a downward trend.
As such, businesses are seeking alternate financing options. The alternative financing market was worth $10 billion in 2022, with an anticipated compound annual growth rate (CAGR) of 15%. A workforce of millennials and “young adults” who are increasingly accustomed to non-traditional banking methods are a big driving force of this trend. Benefits include a faster and easier lending process in many cases.
This trend applies to consumers, too. Buy now, pay later (BNPL) services like Afterpay and Affirm allow shoppers to make a purchase and pay in small monthly installments, instead of all at once. This is more popular than you might think—half of consumers have used BNPL in the past.
2. The Importance of Social Commerce
Though social commerce has been around for a few years now, it’s recently made major headway and only continues to grow as consumers become more digitally savvy. Facebook ads are still the top marketing choice despite diminishing returns.
Consumers love connecting with brands on social media too—77% even prioritize brands that have a social media presence, and 78% of Gen-Zers find new brands and products via social media.
But these new small business trends go beyond simply social media marketing. We’re talking about social commerce—Facebook Shop, Instagram shopping, selling on TikTok, in-app and on-platform checkout. Social media is now more than just a marketing channel, it’s a sales channel.
In 2022, global social commerce sales reached $728 billion and are projected to reach $6.2 trillion by 2030. There are about 106.8 million social buyers in the US alone, a number expected to surpass 118 million by 2027.
Livestream shopping is also on the up and up as a part of this trend, as much of it happens on social media. More than half of retail businesses have used Facebook to livestream shopping events, and about 49% of consumers planned on watching live streams in 2023. Just under 60% of livestream attendees make a purchase during or after the livestream. Plus, livestream shopping conversion rates are up to 10x higher than the average ecommerce conversion rate.
To cash in on these trending small business ideas, figure out which social platforms your target customers use and focus your efforts there. Don’t forget to enable in-app shopping for all your social channels, and to integrate it with your POS and ecommerce platform.
3. Increasing AI Adoption
Artificial intelligence (AI) isn’t technically new in terms of small business tech trends, but it’s certainly had a recent surge of awareness. This awareness brings more small business adoption of and investment in the technology.
And SMBs are seeing the benefits. More than 90% of small businesses that currently use AI say it has contributed to more success for their business. About 80% of retail executives anticipate their companies to use AI automation by 2027—and the AI in retail market is expected to reach $85 billion by 2033.
And 73% of consumers prefer that local retailers automate at least one task in their purchase journey instead of using staff. Another 44% want to be able to use an automated tool to get more product information and availability.
The best part about this small business trend? AI can be used in an endless number of ways, including:
- Personalization: Automate personalized communications, promotions, and recommendations based on customer behavior.
- Search Generative Experience (SGE): Improve web search experiences with topic overviews of search results.
- Segmentation: Automatically segment your email subscribers. This can also go a long way in personalization.
- Analytics: Get more accurate data for improved forecasting and reporting.
- Fraud prevention: Automated fraud protection identifies high-risk transactions, payments, or customers.
Related:
- AI in Ecommerce: Small Business Guide
- Free & Built-in Shopify AI Tools for Small Businesses
- AI Marketing Statistics to Power Your Brand
4. Support for Working Parents
SMBs are becoming more aware of the challenges working parents face. And there are tons of working parents out there. In fact, almost 73% of mothers with children under the age of 18 are working or looking for work.
Plus, after the onset of the COVID-19 pandemic, many SMBs were forced to send workers home and adopt remote work policies where possible. People became used to having this work-life balance and more time at home with their families. So when companies brought people back into the office, many were faced with childcare-related challenges.
Childcare costs can be crippling. Most parents in the US anticipate spending $18,000 on childcare alone in 2024. Two-thirds of families spend more than one-fourth of their income on childcare.
SMBs would do well to appeal to these potential employees. In fact, parents say the top ways employers can provide better childcare support include on-site daycare (30%), childcare subsidies (29%), flexible spending accounts (22%), and backup childcare (21%).
5. Demand for Small Business Accounting Software
Small business accounting software is increasingly complementing, and even replacing, accountants and other qualified small business finance professionals. The market is forecast to grow 19.6% annually, reaching $70.2 billion by 2030.
According to a Capterra survey, 34% of professionals plan to invest in accounting and finance in the coming year. Nearly 40% already use some form of accounting technology to do things like automate bookkeeping, plan budgets, and manage payroll.
And this isn’t just because technology is becoming more accessible. There are actually fewer qualified accounting professionals to work with. Even if you do work with a person, many use software to make their job easier and more efficient. That’s why it’s a great idea to use a small business accounting software from the get-go.
Here are some resources to check out when shopping around for small business accounting software that meets your needs:
- Best Small Business Accounting Software
- Best Accounting Software for Freelancers
- Best Ecommerce Accounting Software
Frequently Asked Questions (FAQs)
These are some commonly asked questions about small business trends.
Business trends are the patterns, strategies, and developments that significantly impact the business environment. These trends can span various industries and are often influenced by changes in technology, consumer behavior, regulatory shifts, and global economic factors.
The definition of a small business can vary depending on the industry. The criteria are typically based on either the number of employees or the annual revenue of the business. These standards are set by the U.S. Small Business Administration (SBA) and are regularly updated to reflect changes in the economy and business landscape. Trends are the patterns, strategies, and developments that significantly impact the business environment.
Bottom Line
The key to small business success? Adaptability. 2024 means embracing alternative financing, leveraging the power of social commerce, integrating artificial intelligence, supporting working parents, and investing in accounting software. By staying on top of these trends in small business startups, you can not only weather the challenges but also find opportunities for innovation and sustainable growth in the competitive market.
