Digitalization—the conversion of business practices to digital tools— among small businesses has been growing rapidly. A website is just the beginning.The COVID-19 pandemic forced small businesses to rethink the ways they operate and accelerated digital tool adoption. In just half a year, the global rate of business digitalization accelerated by seven years. In July 2020, 60% of products or services were digitalized in North America, compared to only 33% in June 2017. According to the Census Bureau's Small Business Pulse Survey, on average 26.6% of businesses surveyed adopted or expanded their use of digital tools since the start of the pandemic.Small businesses make up around 44% of all U.S. economic activity, with about 92% of all small businesses being microbusinesses—defined as having fewer than 10 employees. Microbusinesses face a separate set of challenges when it comes to digitalization, particularly with cost and time. Despite challenges to digitalization, the adoption of digital tools has a largely positive impact on the businesses that digitalize and the economy at large. Consider, for example, that businesses that use many digital tools were significantly more likely to report revenue growth in the past year.Small businesses utilize a range of digital tools for a variety of reasons but there is potential for greater levels of adoption. The Bipartisan Policy Center (BPC) and Intuit have partnered to study the effects of and barriers to digitalization among microbusinesses
