Mipymes, such as shopsprimarily microbusinesses, represent a great engine for the country’s economic development and, according to INEGI figures, this type of company accounts for 99% of establishments in Mexico.
Although these companies have the capacity to generate an important part of the Gross Domestic Product and a large number of jobs (according to the Mexican Institute of Competitiveness, SMEs generate 72% of employment and 52% of GDP), they are not exempt from suffering the current economic crises. In 2021, world inflation reached a historical figure of 9.8% and the country was not exempt from suffering it, since it has reached its highest level in 21 years, standing at 8.7%, according to figures from the Institute of Statistics and Geography ( INEGI).
Crisis or opportunity for small shops and Mypymes?
This scenario represents a risk or an opportunity for businesses in this complex crisis or die trying and join the 800 thousand businesses that have already closed their doors at the end of 2021, according to INEGI. But it can also become a window to get out of this inflation and possible recession that is coming in 2023.
Its consequences can bring other negative effects, production costs are increased by the increase in the cost of raw materials, this leads to more inflation; if prices remain the same despite rising costs, it may affect SMEs; the increase in prices causes demand to drop, which has as a consequence the lack of liquidity and, therefore, the low capacity to reinvest. Only those companies that are prepared for this will be able to face the crisis and emerge prosperous, otherwise they will tend to extinction.
How to make micro businesses prosperous and avoid falling into the valley of death
Some of the challenges they have to face are: the incorporation of new digital tools, the lack of access to financing plans or electronic commerce. Fortunately, there is a solution to these problems, micro-businesses have to understand that being digitally connected allows them to be very competitive, respond quickly to market needs and take care of thinking about strategies that help them withstand the crisis instead of solving it operationally. in a rudimentary way and with what they have at hand.
Some examples of what micro-businesses could do to boost their growth are: have a mid-range cell phone and internet access, have technological tools focused on improving the operation of their businesses such as payment aggregators, tools to manage inventories, have a business card. In addition, today, microbusinesses have the possibility of finding reliable and secure applications that grant them immediate credits to be able to supply their inventories and, if necessary, join the sale by electronic commerce.
It should be noted that there are currently companies that have dedicated themselves to creating digital financial solutions for micro-businesses that go beyond just delivering credits, but have made alliances, for example, in our case we have made allies such as supply centers so that SMEs stock up, we offer them cashback on their first minimum purchase of 1,500 pesos, take inventory without occupying their cash flow and pay for it in up to 14 days through an immediate credit, without using their own money, sell the product, pay the debt and keep the utility, is the best way to help them to become more prosperous.
Alberto Bonetti Friaz CEO and co-founder of YoFio. He has more than 25 years of experience holding C-level positions in the main banks and fintechs in LATAM. He led and was part of the founding team of Banco Promerica in the Dominican Republic turning a small credit card operation from scratch to become the sixth largest credit card issuer in the country. As CRO at YellowPepper’s, he was a vital part of the VISA acquisition a few years later.