The Current Risks and Challenges of Running An Online Business in The UK
Small and medium-sized enterprises, or SMEs as abbreviated, represent the most widespread form of conducting and running a business in the United Kingdom.
Last year, these accounted for 99.2% of the business population, translating to around 5.5 million small businesses accommodating under 50 employees.
Given their immense popularity, it should be easy to understand all the legal matters and red tape surrounding their management.
However, issues can be complicated when you project your entrepreneurial resolutions and aspirations into the online realm, which, as many may already know, comes with different and quite complex requirements, guidelines, rules, specifications, and exceptions.
The risks and challenges of online SMEs shouldn’t keep you from leveraging all the possibilities and opportunities brought by online marketplaces, websites, internet consumers, and so on.
There are numerous unbeatable advantages to managing your store online and welcoming remote customers, such as reducing the possibility of dealing with personal injury claims due to breached duty of care or the slashed investment budget needed to arrange a suitable and safe physical space.
Thus, we’re offering you a breakdown of the main challenges and risks you may encounter as an entrepreneur oriented to make the most out of online tools and sales spaces, so keep reading on!
Security Breaches
Regarding online commerce, one of the most significant matters to call into question is security breaches.
Over 2023, around 2.39 million cybercrime incidents were recorded in UK businesses, representing an 8.1% rise in the average data breach cost, translating to a cumulative outlay of £4.56 million.
The scenario isn’t that dire, though, if we look at IBM’s findings that demonstrate there’s a reduction in the number of data breaches in the UK’s business landscape.
In this respect, artificial intelligence (AI) tools and automation are highly effective in reducing such daunting instances, slashing the average breach lifecycle by 108 days compared to enterprises that are yet to implement such avant-garde protective measures.
Conducting business digitally involves stocking and managing most of the business’ databases and customers’ personal information online, through cloud-like systems or other third parties.
Logically, all this information is just a treasure trove that can draw cyber-attackers to your business like a magnet.
Since data is the most important store of value and means of exchange today, it’s only a matter of time before each SME interacts with similar problems, whether phishing attempts or significant data breaches, on their horizon.
Shortly put, you should never think that a security breach can’t happen to you or that you won’t be involved in such legal matters to be held responsible for data mismanagement.
What you can do, however, is not act paranoically and do the most efficient and easiest thing you can do to avoid unpleasant situations and courts.
You must protect your online business at all costs through special securing software, antivirus, portals, VPNs, and more.
At the same time, invest in worthy insurance and make your customers aware of the risks of coming across a dupe of your website should you observe attempts at crafting fakes.
Precaution that takes the form of tangible actions is the best way to protect a small business from today’s online threats and risks.
Funding Access
Few businesses can make it without needing to access funding through all sorts of methods, whether it’s rounds of money raising, lines of credit, or grants, to name a few.
Access to funding is a critical stone in business development and can quickly become an obstacle if you don’t secure this aspect from the beginning.
Probably, starting with mindlessly low capital only to see hurdles in acquiring more along the way plays with the faith of your long-desired enterprise and is one of the most daunting experiences an ambitious entrepreneur can go through.
Luckily, even if traditional banks in the UK, just like in many other places worldwide, are reluctant to offer such significant financial help to aspiring businesses, there are still several ways to work things out.
You can financially safeguard and launch your start-up with peer-to-peer lending or crowdfunding, which stand as some of the most reliable and successful means to meet your need for cash injection.
Crowdfunding ranks as one of the most common ways of raising start-up funding in the UK, being done on multiple platforms designed for each user’s specific needs and demands.
Furthermore, it allows raising wealth to scale up the start-up, gain publicity, and draw interest in your offerings.
There are two different crowdfunding options, investor-focused and consumer-focused crowdfunding, so ensure your pricing structure and other essential details are discovered and expressed correctly depending on your business’ targeted customer category.
Online Payments
Businesses become more and more confident in the digital payment system and online money transactions, witnessing an increasing involvement in this type of income management.
Entrepreneurs have seemingly more trust in the online banking system compared to last and second-to-last years, if we look into recent studies.
Their understanding and acceptance of online banking have been gradually growing ever since the pandemic kicked in and played with the dynamics in the financial sector, as well as the needs and payment possibilities of customers worldwide.
Mobile banking apps have risen in usage, and websites have started employing automated chatbots to keep up with ever-changing consumer needs.
The ease of use of online payment systems is now a crucial factor determining the success of a business, and UK entrepreneurs know this better than ever.
More than 80% of the UK population has conducted at least one e-commerce purchase in the past. In other words, 4 in 5 consumers have already experimented with the perks of acquiring a product or paying for a service online through digital methods.
Whatever you do, keep an eye on the competition, too!
Since marketplaces abound in retailers and businesses of all sorts putting their offerings in the best light possible, it’s only logical that you must stay ahead of the curve by crafting the best marketing strategies possible.
From learning to read customers’ minds to crafting offerings that stand out, all the traditional needs you may be already familiar with still hold, so you’d better not neglect anything that the marketplaces’ history may have taught you so far.
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