SMEs flying blind, according to research
Research from Scottish Pacific has revealed that SMEs are unlikely to pursue financial advice from outside sources, which opens them up to undue risk if the business is not managed correctly.
The national survey discovered that roughly two out of every five SMEs are operating without any external business development consultants or advisors. Instead, business owners were nominating their trading partners and friends as sources of information.
While there's no reason trading partners or personal associates cannot sometimes provide accurate advice, they do not perform the same role as accountants or consultants who can be employed to give dedicated advice.
The study involved the questioning of over 1200 SME managers throughout the country, providing a comprehensive review of the current business landscape. Scottish Pacific also found that SMEs are often not aware of exactly what drives their business, which suggests a lack of direction for some enterprises.
Roughly a third of those surveyed indicated that key drivers for their company were unclear. This limits growth potential, as important areas of a business can't be improved if they aren't first identified.
In a rather worrying stat, 20 per cent of respondents indicated that luck was an important factor in their business plan. Luck is not a reliable source for sustained business development – it may provide the odd boost, but it cannot be studied or used as a base for further growth.
Scottish Pacific CEO Peter Langham said these concerns were not believed to be as relevant for SME managers as they are often more concerned with more day-to-day issues, such as staff management and cash flow.
If it is a question of time management, then SMEs should be outsourcing important matters that they cannot fit into their daily schedule. Business consultants and accountants can provide the type of advice that eliminates the need to rely on luck or other factors, ensuring your company stays ahead of the competition.