Are SMEs counting the cost of financial inefficiency?
A lack of financial efficiency among the UK’s small businesses could be costing a staggering £175 billion annually, new research suggests.
Accountancy software firm Xero has said an average business in the UK could be losing £35,000 a year as they lack the necessary tools and technology.
More than 1,000 entrepreneurs were questioned across the UK and the importance of technology was highlighted by a large proportion of them.
A total of 95% of people said that technology was also a central part of a happy and productive workplace.
Having the right tools is an essential part of enabling a business to function efficiently and the increasing use of technology is enabling more firms to launch each year.
The influence of technology cannot be underestimated, especially when it concerns systems that manage company finances.
Poor management can leave a company facing corporate insolvency if they don’t stay on top of their accounts and finances.
Those in financial difficulty are advised to seek assistance from insolvency practitioners as soon as possible once any issues are discovered.
This enhances the number of solutions that might be available, which delivers more opportunities for continued trading.
According to Xero, 45% of UK entrepreneurs felt they lacked the right tools and were unsure of how much it was impacting upon their business.
Those in Yorkshire and the Humber felt that technology was most important, highlighting the need for gadgets, fast internet speeds and software more than any other region.
Some 56% of firms in the region said that technology was vital to a happy workplace, while they also valued a good work/life balance more than anywhere else in the UK.
Around six in ten small business owners said they had to prioritise juggling home life and business commitments to ensure everything runs smoothly.
This meant that more workers felt fulfilled by their jobs, with higher job satisfaction helping to boost productivity and the likelihood of success.
By Phil Smith