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You’ve got a friend in SME

By Funding Circle

On 13/07/20

Millions of shoppers have pledged to vote with their feet and continue to support small businesses – after turning their backs on larger chains.

A study of 2,000 adults revealed small independent retailers are now truly back into favour after years of struggling against large multi-national chains.

The vast majority (80 per cent) of shoppers have chosen to buy from independent businesses instead of the larger chains during lockdown – and many won’t go back.

A third of those have bought from a local bakery while 20 per cent have purchased something from an E-commerce store, such as an online craft shop or book outlet.

Independent greengrocers, coffee shops and florists have also proved popular.

The study, commissioned by Funding Circle, the UK’s largest small business loan platform, found 54 per cent believe they have supported small companies more than ever recently, with nine in 10 planning to continue doing so more often in the future.

And 54 per cent have even been introduced to a new independent enterprise during recent months.

Almost two thirds admitted the lockdown has made them realise how important independent businesses are to society and 76 per cent would like to see more of them in their local area.

Lisa Jacobs, UK Managing Director at Funding Circle said:

“It’s been fantastic to see how communities have come together to support small businesses at a time when they need it most. From choosing to buy a loaf of bread at your local bakery to visiting an independent florist for fresh flowers – these small actions make a big difference to small businesses.” 

“This shift in the way people shop will only be positive for the recovery of small businesses over this coming period and it’s promising to see that this trend is likely to continue into the future.”

The research also found 46 per cent of those polled are encouraged to buy from small businesses by the unique products they offer, while 42 per cent said high quality goods entice them.

Half simply like knowing they are supporting their local community and 37 per cent enjoy the personal aspect, such as getting to know the business owner.

As a result, shopping with small businesses makes people feel positive (40 per cent), supportive (50 per cent) and happy (28 per cent).

Foods, home décor and gardening products were revealed as popular items Brits have purchased from SME’s in recent months.

A sixth have also bought books, while a quarter shopped for birthday presents.

It also emerged that other than spending money with them, other ways people have supported small businesses recently include recommending them to a friend (31 per cent), leaving an online review (19 per cent) and liking social media posts (23 per cent).

Two-fifths even said they prefer independent brands, while only nine per cent feel this way about large chains.

Of those who would rather shop with small business, 55 per cent prefer to spend their money with them than a big company and 57 per cent like to know they are supporting the local economy.

And 46 per cent said it’s a nicer experience shopping overall with an SME over a large chain.

A further 39 per cent of those polled feel they know where their money is going when buying from a small business and 34 per cent are even willing to spend a little bit more with them.

Overall, an overwhelming 96 per cent of those polled via OnePoll agreed small businesses are important to society.

One small business which has noticed a change in recent months is British eyewear brand, Finlay & Co who currently have two stores in London.

David Lochhead, who co-founded Finlay & Co with Dane Butler said:

“Spring and Summer are naturally peak seasons for sunglasses sales and this crisis came as we were starting to prepare for our busiest season.

“While our website has seen a surge in demand during lockdown, our wholesale and physical stores faced more difficulty with stores initially closed and subsequent social distancing measures.

“In order to capitalise on the increase in online sales, we used this time as an opportunity to rebuild our website and increase our digital marketing – supported by a CBILS loan through Funding Circle.

“This increase in support from our customers online over the past couple of months and the gratitude we’ve seen from customers coming into our physical stores has given us an incredible boost.

“We are optimistic about the level of interest we’re seeing in our brand across sales channels as the country re-opens.”

ENDS

For more information:

Funding Circle: press@fundingcircle.com/ +44 (0) 203 667 2245

About Funding Circle

Funding Circle (LSE: FCH) is a global SME loans platform, connecting SMEs who want to borrow with investors who want to lend in the UK, US, Germany and the Netherlands. Since launching in 2010, investors across Funding Circle’s geographies – including more than 100,000 retail investors, banks, asset management companies, insurance companies, government-backed entities and funds – have lent more than £8.5 billion to over 81,000 businesses globally.