UAE/Saudi Arabia/Egypt, 15 July 2020 – Facebook, in partnership with the World Bank and the Organisation for Economic Co-operation and Development (OECD), today published the Global State of Small Business report based on a survey of small business owners from around the world. The report is the first in an ongoing series that was planned before the virus struck and is based on data from surveying more than 30,000 small business leaders across more than 50 countries.

Small businesses are the heart of the community – and the unsung heroes of the global economy. From coffee shops, bookstores and restaurants to plumbers, wedding planners and graphic designers, small businesses create jobs and growth in every country, helping to reduce poverty and income inequality. But they are facing the challenge of a lifetime. The COVID-19 pandemic is not just a public health emergency, it is also an economic crisis that is hitting small and medium-sized businesses exceptionally hard. Globally, 26% of SMBs reported that they had closed between January and May 2020 – over 50% in some countries.

SMBs are in urgent need of cash and customers to run businesses and pay salaries. The report saw a significant proportion of SMBs reducing their workforce in response to the pandemic at the time of the survey. UAE (50%), KSA (35%) and Egypt (51%) have reduced the number of employees/workers because of COVID-19. Other key stats from the report showed that UAE (81%), KSA (64%) and Egypt (73%) reported that their sales this year are lower than last year.

Entrepreneurs are resilient people, and the report shows that many Facebook SMB owners remain optimistic about the future of their businesses, despite the challenges brought on by the pandemic. According to the report, 61% of SMBs in the UAE, 59% in KSA and 52% in Egypt are optimistic about their businesses post-COVID.

Globally, nearly three quarters (74%) of SMBs that were closed at the time of the survey expect to reopen as COVID-19 containment measures are lifted. In the sampled countries, for example, the most cited activity by business leaders of closed businesses was working on plans for reopening. In the UAE (65%), KSA (65%) and Egypt (57%) reported some of the highest proportions of SMBs that are operational or engaging in any revenue-generating activities.

The increasing pace and unpredictability of change brought on by the pandemic has encouraged small businesses to adopt a proactive rather than reactive approach to getting back to business. And, according to the survey, the only way for SMBs to survive the pandemic is a pivot to digital. The report found that at least one third of SMBs indicated that they had earned a minimum of 25% of their sales from digital channels in the previous 30 days. In the UAE (40%), in KSA (29%), and in Egypt (35%) of operational SMBs on Facebook reported that 25% of their sales were made digitally in the past month.

“SMBs are vital to the global economy and play a big role in Facebook’s community – and since the early days of the pandemic we have taken steps to help them weather the storm. That is why we recently launched Facebook Shops to make it easier to sell online and created our Business Resource Hub, where small business owners can get training, advice and information – including guidance from healthcare experts,” said Ramez Shehadi, Managing Director of Facebook MENA. “The path to recovery is uncertain and as economies start to re-open, SMBs will need continued support from governments or other institutions to get back on track – we hope this report will help identify areas where that support can make the biggest difference. These are challenging times for businesses throughout the world, and Facebook is determined to do all we can to help them make it through.” 

Over 160 million businesses use Facebook, Instagram, Messenger or WhatsApp every month to reach customers, sell and grow. Over the next six months, SMBs in more than 50 countries and regions will be surveyed monthly regarding business operations in the context of COVID-19, to capture the impacts of the pandemic on the financials and challenges of SMBs, as well as adjustments being implemented in response to the crisis. The objective of this research is to amplify the voice of SMBs and assess how their situations are changing.