Resilience in a Time of Unrest

Amid economic uncertainty, businesses large and small need Payments services that are agile and flexible, Payoneer Chief Revenue Officer Robert Clarkson writes in the new PYMNTS eBook, “What’s Your Plan? Payments Strategies for a Strong 2022 Finish.”

The final quarter of 2022 is going to be a wild ride for digital commerce, whether it’s direct to consumer or B2B. We are seeing widespread concern about consumer strength and capacity, and unlike during the pandemic, it’s coupled with increasingly significant inflationary pressure and fears of a recession. Then we throw in the strength of the U.S. dollar, even against the British pound, the Japanese yen and the euro, and the result is significant shifts in currency usage. The geopolitical uncertainty stemming from the war in Ukraine only adds to the economic anxiety.

Very much unlike during the pandemic — in fact the opposite — we are seeing a buildup of inventory, while the supply chain uncertainty continues. Just look at Nike’s recent news: the company’s planning around expected transit delays and anticipated consumer demand has left it with oversupply of inventory just as macro conditions seem to be worsening. And in another twist, a new cadence in the digital commerce sector is emerging, such as the addition of the second Amazon Prime Day.

Turbulence Ahead

All of these factors suggest that rather than the familiar end-of-year boost, we might experience a more volatile and less predictable Q4 around the world. It’s a global phenomenon, because digital commerce is inherently international.

To best serve these businesses, from the very large to the very small, we need to be hyper-focused on how their spending and receiving patterns might be different from years past. We must be agile enough to handle new up and down swings in AP/AR. We need to accommodate changes in currency preference as macro factors shift. We need to understand that merchants and suppliers are operating in uncertain and for many, unfamiliar times — and be flexible about accommodating the realities they are facing.

Agility is the Backbone of the Global Economy

Small business owners and entrepreneurs are resilient and courageous by nature. We can take great inspiration from our customers, partners and teams in the Ukraine, for example. Our July 2022 survey of 4,200 owners of Ukrainian small and medium-sized businesses (SMBs) asking them about operating under the shadow of war found that Ukrainian businesses have shown remarkable resilience, with 70% continuing operations and 38% even intending to hire more staff this year. They show the rest of the world what can be accomplished even under the most difficult of situations.

Helping businesses with payments is not a numbers game. It’s fundamentally about ensuring that businesses can pay and get paid. During Q4 of a truly remarkable 2022, our focus needs to be on the changing needs of these businesses and deploying the tools at our disposal to ensure that they end the year successfully.