It’s doubtful that you can find a single SMB owner in America who can say that 2021 wasn’t a crazy year filled with unique challenges. Indeed, ongoing safety concerns with the COVID-19 pandemic, the challenge of retaining employees during “the Great Resignation” and inflation and supply chain disruptions threatened the very survival of small businesses. 

So what were the biggest challenges small businesses faced in a year full of challenges? For some everyday small business owners, it was adjusting to the new normal, and for others, it was hiring and retaining staff. Still, others said staying focused amidst the social noise and political divisions resulting from the pandemic were their biggest obstacles.   

Marketing During the Pandemic

For Holly C., marketing manager at Plumbing Lab, digital marketing during the pandemic was the biggest challenge of 2021.

Holly C., social media manager at Plumbing Lab in Albuquerque, NM, said adjusting the company’s marketing techniques while much of the public was sheltering in place due to the pandemic turned out to be a huge challenge. 

“During this pandemic plagued year, I feel small businesses have flourished a lot with digital means, but standing out and spreading the word about your business have been the most difficult,” she said. “Due to the presence of so much noise in the digital space, it has been very hard to spread the word about your business as the competition is global thus using location-specific hashtags has become of utmost importance.” 

Joe Richard, founder of Getpixie, said his company was “lagging behind in reaching out to people” due to new paradigms created by the pandemic, and getting the word out about his company was the biggest challenge. 

“We were lagging behind in reaching out to people,” said Richard. “Some new ways that were devised to have a stronger market presence were to rely more on eCommerce and also to focus more on visual media like creating videos to go with the content in order to improve consumer engagement and create a loyal community of followers who would also be willing to give feedback.” 

Fighting Online Fatigue

For Sam Davis at Sticker Crypt, marketing became difficult in 2021 as consumers were fighting “online fatigue.”

For Sam Davis, owner of Sticker Crypt, reinventing the marketing wheel became the challenge of 2021 as the pandemic forced most people to work online. As a result, it became difficult to reach potential customers online because they were so fatigued by looking at the internet, emails and Zoom calls all day.

“As content developers, we’ve really had to rethink how we’re going to get our content in front of eyes that are willing to consume,” said Davis. “Consumption of video content is at an all-time high, but the popular platforms (e.g., TikTok and Instagram) don’t necessarily translate to search engine placement. So, this year it’s been a balancing act of developing perpetual content (e.g.,  blogs, YouTube) alongside ephemeral content (TikTok and other social media) to engage users and cultivate fans of our brand. It’s a rough place to be in – but we’re making it work.”

Staying Focused During Crazy Times

Nat Noone, CEO of New Wave Soda and Paige Arnof-Fenn, CEO of Mavens & Moguls, said their biggest challenge this year was sticking to their company’s missions and goals despite all of the outside noise brought about by the pandemic. 

“I think our biggest challenge for 2021 was creating a balance in our business between adapting to an ever-changing environment (new covid strains, supply chain issues, freight increases) and staying true to our business plan by not being distracted by recent events,” said Noone. 

“For example, to open the year we built out our 2021 business plan and company goals, and one month in we were told we will no longer have domestic can supply due to an aluminum shortage…We did what we called ‘gentle nudges’ towards changing directions with whatever the latest news was. It’s challenged our team to be more nimble/flexible throughout the year versus hard-charging towards a new fixed plan.”

Arnof-Fenn said that as an entrepreneur, her biggest challenge was staying mentally sharp despite all of the distractions in society.

“There is so much noise out there with the latest variant, social media, 24/7 news, climate change, etc., that for my clients and me, staying focused with all the distractions that we are bombarded with on a daily basis. So, my top tip is to learn to give yourself permission to say no. Whether it means passing on joining another committee, delegating to someone on your team to attend the event, sleeping in (no to an alarm clock), meditating, taking a walk, or just turning off my phone and computer.”

Safety and Health Concerns

Greg Hermann, a partner at Hermann and Hermann, said keeping everyone safe from COVID-19 was the biggest challenge in 2021.

For Gregory Hermann, managing partner at law firm Hermann and Hermann, the biggest challenge was adjusting to the office environment for COVID-19 in order to keep everyone safe.

“Our law firm, much like everyone else in 2021, has had to change the way we operate to keep our team and clients safe from Covid19,” said Hermann. “Much of our daily interactions before Covid were face-to-face, which is not possible because of Covid19. Our law firm has overcome this by using video and phone calls to meet clients. We have also allowed team members to work remotely and in hybrid work models if possible. 

“Another change we have made is offering anyone in our office, like team members, clients, or vendors, a mask when entering. Our law firm also has hand sanitizer stations throughout the office and set up directions to avoid people from coming into contact with one another in high-traffic areas. Thankfully, these changes have kept our team members and clients safe during the pandemic.” 

Staffing Challenges

The Great Resignation continues to cause hardship for companies big and small seeking to hire and retain workers, and small business owners are still feeling the brunt of that.

“The Great Resignation” forced Creative Kitchen to become creative in their hiring, said Christina Russo, marketing director.

“As a business, we’ve always relied on our dedicated core team of freelance researchers and writers to supply the content for our community-oriented site,” said Christina Russo, marketing director at Creative Kitchen. “But the pandemic nearly put paid to that completely, as almost all of our freelance staff needed to find salaried, full-time jobs to support their families…As well as offering our freelance staff above market rates, we now offer them a share of the profit of the site if they stay with us for more than six months, which is paid as a monthly stipend. It’s helped us to keep our contributors and has actually increased our profitability.”

Justina Cerra Lucas, founder of 218 Creative Marketing Consultancy, said she had to rethink her firm’s business model because the contractors and freelancers she relied on left to begin their own businesses during the “Great Resignation.”

“Because of this, client projects weren’t executed to our standards and took excessively long to complete,” she said. “In order to overcome this major challenge, I took a step back to evaluate our business model. The end result was a redesigned package structure that eliminates the need for us to rely on outside contractors or freelancers. Our clients absolutely love the new structure, pricing is more affordable and the projects are now even more profitable for us.” 

Hybrid Work Blues

Of all the small business owners Kapitus contacted for this article, the biggest challenge of 2021 seemed to be moving to a hybrid/remote work environment. The problems with these new models ranged from technology issues to keeping staff motivated while working from home.

Eden Chang, co-founder of PeopleFinderFree, said managing a hybrid workforce was the most daunting challenge of 2021.

“I discovered that managing both in-office and remote teams is a job that requires a significant amount of emotional intelligence, as it’s all about the ability to successfully build interpersonal connections and maintain them,” said Eden Chang, co-founder of PeopleFinderFree.  

“And with ‘The Great Resignation’ proving to be something many companies have had to be cautious of this year, this meant making an effort to connect with each staff member on a more individual level through frequent dialogue as well as through employee surveys.”

For Tomek Mlodzki, CEO of PhotoAiD, switching to a hybrid work environment meant regularly holding group activities outside the office to give his employees a sense of belonging.

“As human beings, we need to socialize, and while some may appreciate remote work, others prefer to spend a couple of hours from the office, hence the adaptation to a hybrid format,” he said. “But more social activities outside the office have helped a lot. If we can’t meet in the office, why not outside?” 

Supply Chain Disruptions

As the switch for the economy was suddenly turned back on in 2021, companies that laid off or furloughed workers during the pandemic had difficulty keeping up with sudden customer demand for goods and services. Therefore, many SMB owners cited dealing with supply chain disruptions as their biggest challenge this year.

“The pandemic has really put a restriction on our supply chain and our ability to get product in our warehouse,” said John Wu, CEO of Gryphon Connect. “This forced us to have backorders on our product and limited our ability to provide a great customer experience for our customers. This has been largely out of our control and has been very frustrating for our team. We hope that these issues get better going into 2022.”

“Having to turn away customers because not having a small rubber seal sure did force us to be creative,” said Scott Kilmer, CEO of Car Windshields. “First, we began reusing parts that could be salvaged which were surprising because they did the job just as good as new ones would.

“Second, we started using smaller companies with good quality products and things have been on the rise. We didn’t suffer from human resources and that was a relief.”

Supply chain disruptions caused massive headaches for Jeff Moriarty at Gem Art.

The supply chain disruption also affected the shipping and delivery of products, as orders got delayed and backlogged due to supply shortages and heavy demand, said Jeff Moriarty, marketing manager at Chicago-based Moriarty’s Gem Art.

“This year, packages that normally took 2-4 business days are now taking over a week to be delivered,” said Moriarty. “Because of this, we had to increase all of our prices slightly and ship everything priority and express. This way we could be assured that packages are delivered on a timely basis for our customers. We are hoping that shipping problems are resolved in 2022.”

Let’s Hope for a Better 2022

The ongoing effects of the pandemic, supply chain issues and difficulties in hiring and retaining crucial employees made 2021 one of the most difficult years on record for small business owners, and many are waiting to sip champagne at midnight on New Year’s Eve and bid goiod riddance to 2021 and usher in what will hopefully be a year of improved conditions.