If you think databases are limited to large multinational technology companies, you are wrong. Even low-tech businesses such as restaurants, small service providers, farms and tradesmen use them to improve their skills. The purpose of this post is to go through some examples of how this happens in real time. We look at how what was once the preserve of large technology teams is now accessible via the cloud and can even be used by smaller companies with an internet connection.
Hybrid transactional and analytical processing
One of the biggest trends currently is the development of Hybrid Transactional and Analytical Processing (HTAP). The idea is to use databases to handle everyday transactions and then use the same systems for complex analytical reporting. Once transaction patterns are understood and analyzed, companies can gain insights into how customers interact with them and when payments are most likely.
A simple example is what is happening in the restaurant industry. Restaurants can monitor how and when people pay for certain restaurant items so they know when to promote them. Patterns may emerge throughout the day, with certain items being purchased more frequently than others, or even on certain days of the week. Understanding this knowledge allows menus to be rearranged to prioritize revenue drivers, especially digital menus that can be easily customized on a computer or through AI.
Facilitating online trading
Stationary companies and tradesmen also use databases to make online trading easier. More and more stores are becoming available that can capture customer data online and then use it in the real world. The idea is to connect physical and digital worlds and enable artisans to sell both locally and globally. Something similar happens in domestic service companies. For example, companies that collect leads for dumpster rentals can now offer more targeted services to tradespeople than ever before.
While previously they would have had to collect these leads internally, there are now third-party compiled databases that they can tap into and tell them who their most likely prospects are.
Once this information is known, these smaller companies can expand quickly.
Improve security and compliance
Databases are also used to improve security and compliance for smaller brands and companies. Databases are useful for backup and access control as well as providing audit trails. The granular level of detail makes it easier to track operations and comply with data protection laws. Previously, many smaller businesses dealt with scattered files and lacked professional protection, but modern approaches to data storage have significantly changed this dynamic. They enable improved file storage and tracking, allowing all network access points to be monitored simultaneously.
Integration with automation tools
No matter how simple a business is, it still requires its employees to complete tasks. Databases are also used here. Many companies use them to integrate with automation tools to improve existing functions.
For example, email marketing is now integrated into databases. The information collected by CRMs is fed into systems that can automate outreach campaigns. These can target customers based on the parameters known to them by the company in order to improve personalization. Another example is cash register systems. Databases collect information from these systems to analyze when payments are made and then feed it into other tools that improve reporting in companies. This also integrates directly into accounting software, reducing middleware that can sometimes cause local business networks to overload.
Support scalable growth
Many databases are also used to support the scalable growth of smaller businesses. Even though many companies such as restaurant chains and tool suppliers have a simple concept, they still face common business problems such as the need to expand from one location to many or to scale growing amounts of data across their online sales channels. Historically this has been a challenge, but the growth and development of databases are making this easier.
Average databases scale horizontally without revisions. This means that once the initial investment is complete, companies can continue to expand to additional locations without significantly increasing their overhead costs. Operating with these systems has low marginal costs. In addition, cloud solutions and open source systems can handle large amounts of data more cost-effectively. Therefore, the price per unit of data tends to drop significantly over time, with many companies paying just a few cents per gigabyte.
This means ambitious companies can grow quickly without facing technological bottlenecks. This means that real constraints will be placed firmly back in the physical world, as they were before the computer revolution in the 1990s.
Unlocking data-driven insights
Small businesses can also benefit from another database advantage – the ability to gain data-driven insights. Even simple businesses still have to make decisions, which is why databases are so important to them. Cloud databases are particularly valuable because they often have built-in analytics. These allow owners to query basic elements (often using AI) and get measurable statistics on the other end.
For example, sales data could indicate a decline in volume. When this happens, owners sometimes panic and try to change things, such as the price. But with a proper database populated with the right types of data, it is often possible to correlate the actual factors that impact sales levels. Once these are known, better decisions can be made and the business can move forward.
Replace spreadsheets
Finally, perhaps the biggest advantage of databases for simple and straightforward businesses is that they can replace spreadsheets. For many companies, even with very simple business models, these have always represented an administrative burden. Excel was used for everything – tracking sales, customers and inventory. Although much of this technology is now moving to the cloud, this allows for data centralization to eliminate chaos and also enable multiple user access. With multiple stakeholders cross-checking and referencing data, many organizations now have a single source of truth, greatly improving decision-making.
So if you run a simple business, do you think about using databases to improve it?
