Customer Management Articles

A Business Software Perspective on US Small Businesses and Recession – Part 1

by Rakesh Sharma
Published on 8 September 2011

small business software for recession

At, we are focused on providing an array of options for small business software to help solve your efficiency and productivity problems. Acknowledging that each geography is specific, we are analyzing small business needs for multiple geographies.

Based on economics, vendor support and customer preferences, we provide a list of SaaS (Software as a Service) options for small business needs in your geography.

This post in two parts features software solutions for small businesses in the United States.

In this post, you will discover a list of applications that are most popular with users in the United States.

The news is not good

That's a common refrain I hear from small businesses during my weekly walk in the business district near my home. I began my walks at the start of my US grad school sojourn to learn more about business. During my walk, I note the number of new (or shuttered) shops or simply talk to a random business owner or two. I am not a trained economist and hardly possess the necessary acumen or knowledge to comment on the economy. However, the exercise gives me a general insight into the state of small businesses in the local economy.

And, the news is indeed not good.

A report from the U.S. Small Business Administration (SBA) Office of Advocacy states that total small business outstanding loans dropped 2.4 percent from $624.3 billion in December 2010 to $609.4 billion in March 2011. Both micro- and macro-business lending were down. Buffeted by depressed consumer demand and lack of a skilled strategy, small businesses are either closing down or hoarding cash for better days. This is bad news in an economy that is predicated on consumer spending. Added to that are fears of a double-dip recession, or a recession redux.

But, to get back to my weekly walks.

One of the things I discovered during these walks is that most small businesses think the easiest way to cut costs is to either prune their array of services or lay off employees. In other words, their decision matrix is a reductive two-columned one, in which efficiencies and productivity are absent.

Where do cloud-based software fit into the decision matrix?

Quite simply, all over the place. They increase your efficiency by making employees more productive, whether they are in the office or not. They also decrease your costs. Thus, instead of paying the full amount for an expensive application, you can cherry-pick your features and price. Finally, the most important benefit of applications as a service is that they enable you to scale your business according to demand. Times are tough and consumers are pruning budgets. Based on demand, you can cut back on key areas in your business' operations accordingly.

But, your business has multiple units and identifying key areas of productivity gain is a problem.

A survey released early last year (immediately after the recession) might provide pointers about changes to operating strategy for small businesses. The survey, conduced by The Growth Coach (a business coaching franchise system), lists four key areas of growth identified by small businesses in the US. While the survey was released last year, much of it holds true even today, when economic uncertainty and conditions are not very different. Of course, the key areas are pretty generic. However,I have extrapolated these areas to map them to specific business applications categories that might help you decide on which applications you need and what is best for you.

Listed below are the most popular applications on in each category outlined by the survey. The post is split in two parts. Part 1 will cover sales, marketing, HR and social media while Part II will cover project management, collaboration tools, customer support, online back-up, accounting and ERP.

Hopefully, these should help you beat the recession and increase your business:

  • Growth area #1: Wiser sales and marketing investments

  • CRM

Conventional CRM tools are time-consuming and complex to install and maintain. Web-based CRM is fast becoming an alternative. The focus of this form of CRM is on customer interaction, including in social media. Online CRMs also represent less costs as you end up paying per user, instead of using a single system.

Most popular online CRM Applications are: Zoho and ContactChamp

  • Email Marketing

This is an inexpensive and effective form of marketing for small businesses. Investment costs are extremely low while returns (in an age of e-commerce) can be pretty high:

Most popular email marketing tools are ActiveCampaign , Pinpointe

Growth area #2: Changes to leadership and management approach

  • HR

Online HR software enables you to connect and account with your employees in a much more efficient and modern way. No more complex systems and forms for you and the employee. Instead online HR tools simplify the process and make it transparent for you as well as for employees and applicants.

Most popular online HR tools are TribeHR, Intuit Online Payroll

  • Social Media

In an age of Facebook or Twitter, one the best form of communication medium is social media. Social media marketing strategies enable you to connect, complement, and sell your products to customers, almost for free.

Most popular social media tools are SproutSocial, HootSuite

Part II covers project management, collaboration tools, customer support, online back-up, accounting, ERP and integrated Small Business Suites.


Apps mentioned in this article