Small firms lose 120 days annually to admin tasks

The UK’s network of small businesses are wasting 120 working days annually on administrative tasks, a new report has claimed.

According to technology firm Sage, 5.6% of total staff time at SMEs is spent on aspects of business such as invoices and recruitment, as the firms lack sufficient systems to manage the processes effectively.

The report also suggests that if productivity was boosted by a similar amount, the UK’s gross domestic product could be increased by around £34 billion a year.

Time spent on accounting tasks was found to be the most costly, as it made up 20% of the total time spend on administrative tasks.

Sage has also called on the Government to make it easier for small businesses to grow by removing some of the financial and administrative hurdles that SMEs need to overcome.

The study follows a similar study from breatheHR, which suggested that CEOs of small and medium sized businesses are losing a fifth of working week to HR activity.

This focus on admin tasks such as expenses and logging absence means they are unable to focus on business growth, which is ultimately costing their businesses.

Perhaps more worrying is a sign that the situation has not really improved from earlier in the year, as a February study by Immervox showed that 35% of SME leaders were spending too much time on paperwork.

That report showed that they were spending three times as many hours as they should be on admin, which was taking precedence over innovation, planning and customer service.

A further study from early summer found that UK employees spend more than 441,827,000 annually on ‘time wasting’ office tasks, of which admin was included.

Red Letter Days for Business said that businesses are suffering as a result as they are losing sales and placing more pressure on already stretched cash flow processes.

Given that late payments continue to blight small businesses, failing to focus on long-term growth may cause firms to struggle.

While some may be able to source alternative finance options to aid growth, others may need to consider restructuring processes such as turnaround management in order to boost performance.


By Phil Smith


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