SMEs believe they could go out of business if they don’t adapt to new technology
More than a third of UK SMEs believe they are in danger of going out of business if they don’t adapt to new digital strategies and technologies, according to a new report.
The 2016 SME Barometer Research, from business software developer Exact, looked at thousands of small and medium businesses from across Europe and the US. It found that 38% of those in the UK fear they could go out of business within the next five years if they don’t adapt.
Almost two thirds (64%) of SMEs in the UK said they now face increased competition from new digital competitors in their sector or space. The study also found that SMEs across all seven countries surveyed (the UK, Germany, France, Belgium, Spain, the Netherlands and the USA) said they were currently planning for growth.
Almost three quarters (73%) of SMEs in the UK said they were looking to achieve growth over the next 12 months. France had particularly high ambitions in this regard, with 90% of French SMEs aiming to expand.
Despite these ambitions and the perceived risk of insolvency however, only 6% of SMEs in the UK said they were actively investing in the technology they needed to keep up with the digitalisation process and help them keep their market share. Only 2% said they had already done something about it.
More than half (56%) of British SMEs did say they were at least exploring new business models. Much of the focus was on investing in new technology in the future and hiring tech-savvy talent. SMEs in the UK were concentrating on online sales (30%), partnerships and channel sales (26%) and putting the right talent in place (27%) in order to boost their businesses.
The USA was focusing most heavily on online sales (cited by 39% of American respondents) while Germany was heavily behind forming new partnership agreements (31%).
The report also found that cloud-based technologies have already gained a great deal of traction, with 58% of UK-based SMEs using at least one cloud tool.
By Phil Smith