78% Of Retail SMEs In Middle East and Africa Optimistic About Future

Although different sectors were exposed to and impacted in diverging ways to the extensive changes of the COVID-19 pandemic, Small and Medium Enterprise (SME) confidence across most sectors is on the rise, according to the latest research by Mastercard.

The inaugural Mastercard Middle East and Africa (MEA) SME Confidence Index found that 78 percent of SMEs in the retail sector are optimistic about the next 12 months.

Confidence levels were highest among retail businesses, slightly ahead of other sectors, like food and beverage, entertainment, construction, and manufacturing.

In addition, 70 percent of SMEs in retail are projecting revenues that will either grow or hold steady. Half (50 percent) are projecting an increase.

 Access to skills, digital payments, and data key for future growth

Small and medium-sized businesses in the MEA region’s retail sector have identified training and upskilling staff (55%), acceptance of digital payments (49%), better data and insights (49%), and easier access to finance (49%) as the top drivers for growth.

This highlights the opportunities for small businesses that arise from both internal transformations as well as industry regulations and trends.

Making sure that SMEs have all the support they need to go digital and grow digital is a key focus for Mastercard. The company works closely with the government, financial organizations, and the wider business community to create opportunities for the small business sector.

Solutions that go beyond the cash register

As part of its support to the retail sector, Mastercard offers technology, data insights, consulting, and predictive analytics solutions to empower retailers to acquire new customers, enhance customer loyalty and improve operations. Mastercard spends insights offer retailers a 360-degree view of their shoppers, with its platforms and services translating those data-driven insights into action.

For many small businesses, reducing their dependence on cash through digital payments acceptance has played a major factor in being able to get paid and maintain revenues.

Mastercard has pledged $250 million and committed to connecting 50 million micro, small and medium-sized businesses globally to the digital economy by 2025 using its technology, network, expertise, and resources in support of the company’s goal of building a more sustainable and inclusive digital economy. As part of these efforts, Mastercard is focused on connecting 25 million women entrepreneurs.

“Small and medium-sized businesses are vital to the diversity of economies, and to the progress of economic recovery. The MEA retail sector’s SMEs have shown resilience by prioritizing best practices and really internalizing the power of digital – both in-store and online through contactless and eCommerce.

As their digital transformation successes increase adoption in other sectors, the whole ecosystem benefits by sustainably driving commerce forward into a future of growth,” said Amnah Ajmal, Executive Vice President, Market Development, Middle East and Africa, Mastercard.

Rising costs and maintaining staff among concerns

When asked about the main thing that keeps them up at night, 56% of regional SMEs in retail mentioned the challenge to maintain and grow their business was their top issue.

Looking at concerns over the next 12 months, over half (54%) identified the rising cost of doing business, while 41% cited access to capital.

From an operational perspective, concerns for the next year include maintaining current staff levels (42%), training staff (37%), and finding the right talent for new needs (36%) – highlighting the growing trend around the development of people as a key theme for small business success.