For small businesses, the digital divide tends to be less about access to technology and more about knowing how and why to use it. But the pandemic has shown business owners just how valuable the internet can be to their bottom line.
Take Jukebox in Cleveland, for example.
The bar and restaurant has been around for about seven years, but before the pandemic, it didn’t have much of an online presence beyond a website and social media.
But when the pandemic shut the doors to bars and restaurants, owner Alex Budin worked to add an online retail component to Jukebox, selling bottles of wine and packaged cocktails. Even when Jukebox reopened to in-person dining, Budin kept the retail side going. Adding it was a “reactionary” move last year, but it has become “a key part of how we do business now,” Budin said. On-premise dining will always be the core of Jukebox, but the online options help.
And that goes beyond food and drinks. Jukebox long has had an active music trivia night, Budin said. So when the pandemic pushed everything online, that went virtual, too. And it “took off like wildfire,” drawing in people from outside of Cleveland, he said. So even though music trivia is back in person, Jukebox also hosts the event online simultaneously.
“If you were to define Jukebox’s business structure pre-pandemic, we were a one-legged table,” Budin said. “We were propped up by on-premise dining. And when you take away on-premise dining, we didn’t really have anything to support the business. So I’ve used online ordering, carryout like using the food delivery apps like Uber Eats and Grubhub, to create more legs at the table.”
Jukebox’s story isn’t unique.
Small business owners are typically about a “decade behind the technology curve,” said Roger Geiger, the Ohio executive director for the National Federation of Independent Business. Resources are limited, and there can be a lack of tech familiarity because many small business owners are 45 or older, he said. That aspect, though, has been changing as more younger people start businesses.
Small business owners often hesitate to spend to upgrade their technology, said Lorne Novick, senior partner of services and deal flow management at JumpStart Inc. in Cleveland. But that can hold them back and hurt their revenue, especially during a pandemic that pushed business online. Small businesses have been asking JumpStart for help to increase their digital literacy in areas such as digital marketing, social media and financial technologies, Novick said.
Rashida VanLeer-McHargh was one of the business owners taking part in JumpStart’s Impact program during the pandemic. She runs Iron Koi, a boutique fitness studio in Shaker Heights that has been in business for almost a decade. She offers personal training and classes and had wanted to learn more about finances. But the program also helped her adapt to an online environment when that became necessary.
Prior to the pandemic, VanLeer-McHargh didn’t even own a computer. Iron Koi had a website, but it wasn’t interactive, and she handled social media and banking for the business from her mobile phone. She was making a profit and doing well, so she didn’t see the need to change how she did business.
But when the pandemic started, VanLeer-McHargh realized she did need to make a change. She got her studio connected to the internet and bought a computer, connecting with clients online and starting a YouTube channel. Even now that in-person sessions are an option, virtual meetings allow clients to keep sessions if they’re feeling a little under the weather, traveling or just busy, VanLeer-McHargh said.
And she can’t imagine running her business any other way.
“Because we are so seamlessly integrated,” she said.
In addition to helping with day-to-day tasks, access to the right technology plays a role in long-term planning for small businesses.
The digital divide can be a hurdle for people who want to start a businesses, said Jim Griggy, a business advisor at the Ohio Small Business Development Center in Akron. If someone doesn’t have a home computer, it makes it difficult to research and put together a comprehensive business plan, which is necessary to get funding. And that challenge became even clearer last year, when the pandemic took away access to a lot of public computers.
“Existing businesses have business systems in place. Good or not, they have their systems in place,” Griggy said. “And so, if they don’t have access, or don’t use digital technology, or don’t use computers … they don’t miss it.”
But there are challenges for existing businesses, too, such as those looking to apply for financial assistance like the CARES Act.
The Small Business Development Center at the Urban League of Greater Cleveland has been running a financial literacy program, but the group found that many entrepreneurs were participating on their mobile phones, said director Shashonna Duckworth. Not only can such a small screen make it hard to see, it’s difficult to complete tasks like uploading documents, which is necessary for applications for assistance. The organization has been working to get donated devices to participants, and its computer lab has been open.
The Greater Cleveland Partnership also has been hearing from companies that faced access challenges while trying to apply for financial assistance this past year. A lack of access to high-speed internet — which is the case in many low-income Cleveland neighborhoods — can lead to a lack of digital literacy, too, because people aren’t gaining familiarity by using the technology, said Brian E. Hall, senior vice president and executive director of equity and inclusion at GCP.
A map of the neighborhoods without that access looks similar to a redlining map, Hall said. Those areas with high-speed internet connections, and those without, were intentional decisions. And that affects people living in those neighborhoods, as well as the small businesses located within them.
To close the gap, the access issue needs to be resolved first, Hall said, and then businesses will need exposure to and training on the different digital tools at their disposal.