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Building a Resilient Small Business Ecosystem

3 Mins read

It’s safe to say that nearly every industry felt the impact of the pandemic in one way or another, particularly the small business community. With tighter budgets and fewer resources, it’s no wonder that almost one-third of small businesses closed their doors during this time. Even for those that were able to maintain their operations, many had to quickly pivot, turning to things like e-commerce, outdoor dining or remote work to keep the lights on. Paired with the fact that many small businesses had limited support staff or the technological infrastructure needed to efficiently apply for PPP loans, SBA assistance and other grants, this critical segment of the economy was in tremendous need of support. But, the true testament to any organization’s strength is how they overcome adversity and bounce back. And that is exactly what small businesses in the Ocean State have done, thanks to a “rising tide lifts all boats” mentality, a strong sense of community, and sustained public-private collaboration.

While we undoubtedly want to put the pandemic behind us, the learnings from that period of economic and societal uncertainty present a tremendous learning opportunity, allowing states to build even more resilient small business ecosystems in the future.

As we move into an endemic state, it’s more important than ever that state leaders listen to the unique and specific needs of the small businesses in their state. We did this recently through a dedicated small business survey, which found that the four biggest challenges were finding and retaining workers, finding new customers and expanding to new markets, garnering sources for funding, and training employees. While directly addressing these four things is bigger than any one company or government can tackle, state leaders can still offer support by making it as easy as possible for businesses to navigate any red tape that comes with owning and operating a small business. In Rhode Island, for example, we recently piloted a business identity management platform by using a centralized data lake and distributed ledger to store business details. The idea was that a distributed ledger would securely store a business’ data and enable a digital identity wallet. Thinking outside of the box and implementing innovations such as blockchain to simplify how government agencies and businesses collaborate can help reduce the hoops business leaders have to jump through on a daily basis. Doing so frees up time and resources so small business owners can better focus on their core business operations and deal with other macro challenges like increased costs and the ongoing talent war.

Beyond streamlined processes, governments and state leaders are uniquely positioned to act as facilitators between companies that need specific technical assistance, and other in-state businesses that can offer up their resources and expertise. In the Ocean State, Rhode Island Commerce serves in this critical role, creating a strengthened in-state network of businesses that support one another. At the onset of the pandemic, for example, several industry-leading technology companies with a presence in Rhode Island volunteered their time and experience, offering free 1:1 sessions with local small businesses to help them set up equipment to work from home, shift to an online business model, or aid with document management and security. Rhode Island Commerce facilitated these connections between the technical service providers and the small businesses, creating a strong and resilient business ecosystem even during the most uncertain times.

While it’s easy to focus attention on enterprise-scale businesses that might employ tens of thousands of people, it’s really the small businesses that serve as the backbone of so many communities. Government agencies must continue supporting and making small businesses a priority for their broader state – and national – economies to flourish. Despite the trials and tribulations of the last decade, Rhode Island’s economy and business communities are thriving. The Ocean State has witnessed one of the biggest drops in unemployment rates across the U.S., moving from 11.2% in 2010 to 3.5% in 2020. The Ocean State has also been named the #1 state in the Northeast for economic recovery – largely due to the continued public-private collaboration within the state. This spirit of information and resource sharing continues to be the central focus as we move forward and look to make our small business ecosystem even stronger.

Elizabeth Tanner is the Rhode Island Secretary of Commerce.

Rhode Island stock image by Joseph Sohm/Shutterstock

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