Swiss SMEs are proactively finding ways to pull through the coronavirus crisis
The COVID-19 pandemic has maintained its iron grip on the economy throughout 2020. This year's Credit Suisse SME study looks at how Swiss SMEs are approaching their crisis management and how they are preparing themselves for the new normal.
Coronavirus crisis leaves its mark on SMEs in Switzerland
The coronavirus pandemic has plunged the Swiss economy into an unprecedented crisis. Measures to contain the pandemic led to a significant decline in economic activity. While the rapid delivery of federal support measures limited the damage to businesses, in the fall of 2020 more than half of SMEs were still operating at below pre-crisis levels or were undergoing acute crisis management.
SMEs are preparing for the new normal
How are Swiss SMEs coping with the crisis and the changes it has brought? This year's Credit Suisse SME study focuses on this topic, and 1,001 Swiss SMEs were asked about this between September and early October 2020. The survey shows: In addition to external assistance in the form of emergency loans and short-term compensation, Swiss SMEs are committing themselves to actively prepare for the new normal.
Since the beginning of the crisis, almost half of SMEs have adapted their business model to cater to changing client needs. Four out of five companies undergoing acute crisis management in the fall of 2020 had chosen to take this step, with 76% of these deciding to change their direction permanently. The proverb "necessity is the mother of invention" seems to have been confirmed this year.
Despite – or even as a result of – coronavirus, SMEs are planning their future investments
In order to make their companies more resilient and set the course for future growth, almost 60% of SMEs plan to invest in the future. In particular, those who judged their business performance to have declined during the pandemic are looking to make investments in the future. In these instances, the coronavirus pandemic may have acted as a catalyst for more urgent change. The companies surveyed stated that they are primarily planning real investment in technical equipment, machinery, and real estate, for example.
Also on the agenda of almost every company is the need to improve the level of digitalization. More than half of SMEs have identified automating business processes and expanding the IT infrastructure as areas where action is required, closely followed by employee training and ensuring IT security. Those who can afford it are also investing in ecological sustainability.
Stability of supply chains is becoming increasingly important for Swiss SMEs
Growth can only be guaranteed if the value and supply chains function properly, but the coronavirus pandemic exposed their weaknesses and companies in Switzerland and around the world suffered from the interruption to global supply chains.
Dependency on the state of affairs in Asia and around the world is prompting Swiss SMEs to rethink their supply chains. Many are planning changes in the future. However, restructuring comes with higher costs and risks in the short term. For this reason, the authors of the study have concluded that SMEs are often likely to retain their existing supply chains but invest more in the local area in order to diversify their portfolios.