Too Many Small Businesses Are Not Embracing Technology

| August 15, 2012 12:56 PM video

Technology is playing a leading role in New York City economy, but for the city’s small businesses, technology seems just a tiny supporting character as too few of them are taking advantage of it, according to a report released today by the Center for an Urban Future (CUF).

A snapshot of Downtown Flushing. Flickr/Pro-Zak.

Many small businesses have neither integrated the Internet or consumer behavior into their daily operations. Barely two-thirds of the small businesses surveyed for the report,  titled “Smarter Small Businesses,” have a website or use social media tools to advertise their service.

One aspect of New Yorkers’ spending that can be capitalized on are their seemingly ceaseless appetites.  As New Yorkers venture into unfamiliar outer borough neighborhoods for ethnic food,  how will they choose among authentic holes-in-the-wall or other simple locally popular eateries? By properly utilizing social media and the Web, restaurant owners in immigrant neighborhoods like Flushing or Jackson Heights could lure more outside customers, the report pointed out, since the fastest way to learn about a place is through online reviews.

Gary Lin, 30,  realized the unique function of social media three years ago and created a Facebook page for his bubble tea brand T Baar, which he launched in 2006. He actively manages the site by posting pictures of new products and promotional events, and responds to customers’ comments.

First launched in 2009, three years after TBaar was founded, T Baar's Facebook page has been a helpful tool for promoting Lin's bubble tea business.

“The good thing about the Facebook page is it provides an immediate conversation platform to engage my customers into my business,” said the owner of four bubble tea shops in Sunset Park, Brooklyn, and two in Chinatown, Manhattan – neighborhoods with large Chinese populations. “Some of them even discovered my personal account and friended me. It helps me build a closer relationship with my customers.”

Besides Facebook, Lin also regularly monitors his stores’ Yelp pages to find out what people think of his products and service in order to make necessary alterations. Although bubble tea is usually considered “very Asian,” Lin said he’s aiming to attract more ethnic groups in the city.

Also located in a Chinese community, the Yi Mei Fang Bakery Company in Flushing, Queens, is operating in a much more traditional way. It opened on Roosevelt Avenue over a decade ago and has only targeted loyal customers. The bakery owner Mr. You, who is in his 60′s, said he’s satisfied with his current sales, and never felt it essential to connect his business to the Internet, not even email.

WATCH VIDEO:

New York City business owner Gary Lin spent three years researching Asian bubble tea in order to please the American market in New York City . Video courtesy of Menglin Huang.

The CUF  reports that the older the business owner, the less likely his or her business will have a Web presence. Many newer businesses launched by younger entrepreneurs are more likely embrace technology as it’s probably integral to the owners’ day-to-day lives. The technology alone can give them a competitive advantage over more established businesses without a website or social media outlets.

Meanwhile, owners of businesses with higher incomes report having a website – 81 percent – whereas only 59 percent of low- to moderate-income owners do.

Among the other key findings, the study also indicated that very few proprietors embrace automated systems to manage their daily operations.

According to the report, the point-of-sale system is only adopted by 37 percent of small businesses in the retail or hospitality fields, the ones who could see the most benefit in business by taking advantage of such technology. Also, only half  of the surveyed firms with three or more employees use an automated payroll service.

“Technology is no longer an option for small businesses to remain competitive. It’s absolutely essential in today’s digital age,” Jonathan Bowles, executive director of CUF, said at the report’s release, “Adopting even the most basic technology tools will help level the playing field for small businesses and enable more small firms grow to the next level.”

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