Latest Alibaba.com B2B SMB Survey Shows U.S. Small Businesses that Digitized Operations Saw More Sales Growth Over the Past Two Years Versus Analog Counterparts

-Alibaba.com surveyed thousands of U.S. SMBs in pre-pandemic December 2019 and again in December 2021 and found digitized businesses are faring better, exporting more, planning to invest more and are significantly more confident about the future of their business than offline companies

-Following a quarter with robust growth of around 50% year-over-year increase in Gross Merchandise Value (GMV) on the platform, Alibaba.com kicks off March Expo 2022 to give digitized businesses even more options to unlock global opportunities

Alibaba.com, one of the world’s largest business-to-business (B2B) ecommerce marketplaces and a business unit of Alibaba Group , unveiled the results of its third Alibaba.com U.S. B2B Small and Medium Business (SMB) Survey which captured current SMB insights and sentiments and compared the findings to previous surveys conducted in December 2019, two months before the pandemic reached the U.S., and mid-pandemic in September 2020.

Results from the latest survey of 2,401 U.S. SMBs conducting B2B business found nearly three-quarters (74%) are optimistic about the economy, which surpassed the pre-pandemic level of 62%, despite the current supply chain, inflation and labor market challenges. Many are also expanding their digital commerce and exploring international channels: about half (47%) of U.S. B2B SMB trade is now through ecommerce, a nearly 12 percentage point jump in two years, and 70% of SMBs are conducting international B2B trade, compared to 59% in December 2019.

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“We saw nearly two decades of change take place in early 2020 as business owners pushed to get digital amid the global health crisis and now, two years later, it’s clear that their flexibility and grit has paid off”

Getting Digital is No Longer a Nice to Have

Digitized businesses reported even higher levels of optimism than their offline peers, bolstered by stronger sales performance, larger anticipated investments and more global exports:

• Digitized SMBs far outperformed businesses that are still operating offline in terms of sales and sourcing: 61% of digitized businesses saw increases in sales in 2021, compared to just 34% of those who are not online.
• Digitized SMBs are expected to invest more in growth in 2022: Digitized businesses are more likely than non-digitized businesses to make investments in 2022, including hiring more full-time employees (48% vs. 32%) and increasing capital expenditures (49% vs. 33%).
• Digitized businesses are better equipped to go global: 39% of digitized businesses expect to grow exports in 2022, versus just 13% of those who rely on offline channels.
• Digitized SMBs are significantly more confident about the future of their own business: 91% of digitized businesses are confident in the future of their business, compared to 80% of non-digitized businesses.

“We saw nearly two decades of change take place in early 2020 as business owners pushed to get digital amid the global health crisis and now, two years later, it’s clear that their flexibility and grit has paid off,” said John Caplan, President of North America and Europe of Alibaba.com. “Our proprietary research into an important and growing segment of the U.S. economy finds that getting digital is critical to success, with digitized businesses far outperforming in sales, exports, and investments versus those still operating offline using analog tools and processes. These trends are accelerating the success of U.S. SMBs as they leverage the tremendous digital tools and infrastructure available with Alibaba.com to make it easy to sell and source globally.”

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During the quarter that ended on December 31, the Gross Merchandise Value (GMV) of transactions completed on Alibaba.com grew around 50% year-over-year. Revenues for the business unit grew by 29% year-over-year, particularly the value-added service revenue (up 43% year-over-year), which includes services such as global logistics and Alibaba.com Trade Assurance.

Ulviyya Nasibova, Founder of Uli’s Gelato, voted L.A.’s Best Ice Cream 2020 by Los Angeles Magazine, and one of the 2021 Alibaba.com Grants Program recipients, is one of the many small business owners who has recently expanded into ecommerce. According to Nasibova, “In 2020, the foot traffic outside of my brick-and-mortar stores completely died, as well as the wholesale channel to restaurants. It was clear that we needed to adapt to stay afloat, so I decided to go back to the basics, examine everything about my brand, and determine how we could make it work online. Our pivot to ecommerce is now in progress, and I believe it will make my business resilient despite the obstacles being thrown at us.”