Help to grow: SME's plan to invest to unlock business growth
It's no surprise that overall investment made by UK businesses in 2020 dropped when compared with 2019. According to stats produced by the Treasury, there was a reduction of 11.6 per cent in investment between Q3 in 2019 and Q3 in 2020, as many UK businesses were focused on cost savings and reduction.
Yet as the UK’s successful vaccine rollout brings with it a wave of optimism that the UK is heading towards a solution to the pandemic, business confidence is returning too. The Federation of Small Businesses, which conducts a quarterly Small Business Index, says SME confidence is currently at its highest level since autumn 2014.
For business leaders, their concentration is now on enterprise-led recovery and getting back to business growth. And many believe digitisation is key. A recent report highlighted that 80 per cent of SMEs believe digital adoption is critical for recovery and job creation, with a third claiming they have the cash available to invest in the technology solutions their business needs.
A separate survey, carried out by Virgin Money, found that 35 per cent of SMEs plan to invest between £10,000 and £10M this year into their business to stimulate growth - which is a 32 per cent rise when the same question was asked in 2020. There is a clear determination among SMEs to see their business growing again as well as to future-proof it for events that cause mass business disruption like Covid-19 has.
For businesses looking to unlock business growth, it's about determining the right solutions and support that’s going to improve processes which make cost savings and fuel revenue. The good news is SMEs are well placed in understanding their technology solutions requirements and budgeting for them too - even before the pandemic placed a greater emphasis on technology.
In a survey reported by the Telegraph in 2019, It found that 70 per cent of decision-makers within SMEs have a good understanding of its technology capabilities and that investment in technology is usually made to overcome specific challenges. Cost was pinpointed as the biggest barrier to investing, with 57 per cent stating it as a concern.
The challenge therefore for SMEs isn't about knowing which technology is right for them, but understanding how best to make technology investments within their budget.
A Trend Towards Small Business
One reason SMEs should be looking to invest in technology now is to tap into consumer trends towards local over big business.
According to the Future or Small Business Report which surveyed 500 SME owners and 2,000 consumers, people’s attitudes during the pandemic have been towards supporting small businesses. It’s been well documented that major brands have been able to use technology to pivot operations and take advantage of growing online demand for products and services. But technology also creates a more level playing field for smaller businesses too.
By investing in either team or customer facing technology solutions, smaller businesses can free up their teams’ time to focus on customer service, which is what really makes them stand out from some of their larger competitors and why often consumers prefer local or small businesses over big.
Many SMEs are now investing in their ERP or central business software to provide tools to boost their teams productivity or for better oversight of business performance through the likes of analytical tools that can produce reports on the figures at the click of a button.
Help to Grow
To help SMEs in the UK invest in technology solutions, the government is launching the Help to Grow:Digital scheme this autumn. The platform will provide advice and guidance to SMEs around digitisation. There will also be the opportunity for businesses to claim a 50 per cent discount on approved software - potentially making savings up to £5,000.
The scheme will be available to limited businesses who have between five and 249 employees, have been trading for more than 12 months and are a registered business on Companies House. As mentioned previously, cost is one of the biggest barriers to small and medium businesses investing in technology - with this scheme, businesses will be able to make a significant saving on investing in technology solutions from approved providers.
SMEs confident about unlocking business growth should be looking to take advantage of the scheme.
For more information about the scheme ahead of its official launch, visit: https://helptogrow.campaign.gov.uk/