How can SMEs learn to thrive, rather than just survive?
New research from the #SBS State of the Nation Roundtable report has revealed that 72 per cent of small and medium-sized enterprises (SMEs) feel they are surviving, rather than thriving.
Fewer than one-third of small businesses have enough cash in hand to be able to keep their businesses afloat for more than six months, while 58 per cent have not invested in their business over the past year because of economic instability.
More than one-third of small business owners have taken a salary cut just to keep their businesses afloat.
Challenges and opportunities
The report highlights the financial strain SMEs are under, with many facing challenges such as rising costs, Brexit-induced red tape, and a lack of access to finance.
On the positive side, nearly half of small businesses are already employing Artificial Intelligence (AI) in their business, with 60 per cent saying they are excited about it.
The advent of AI provides an unparalleled opportunity for SMEs to level the playing field with larger counterparts, allowing SMEs to think big.
Strategies for thriving
While the report casts a shadow over the future growth of many SMEs, it is important to take stock of strategies that are at hand to help businesses thrive. These include:
- Cash flow management – Regularly review your cash flow and make adjustments as needed.
- Access to finance – Explore different financing options, including grants and low-interest loans.
- AI integration – Utilise AI for automating mundane tasks and data analysis.
- Digital marketing – Invest in online marketing strategies to reach a wider audience.
- Export opportunities – Microbusinesses have shown the way in exports, with nearly half making exports last year. SMEs should explore international markets for additional revenue streams.
- Budgeting – Keep a close eye on expenditures and cut down on unnecessary costs.
- Outsourcing – Consider outsourcing non-core activities to reduce operational costs.
While the current economic conditions remain a challenge for many SMEs, remaining proactive and utilising the options above are key to ensuring a thriving business.
Our expert team of accountants can offer further advice on helping your business grow. Please contact us today.