More than a third of Britain’s small-to-medium sized enterprises (SMEs) believe that if they do not adapt their business models they will go out of business in five years.
However, only 2 per cent have already taken action to align their businesses with market developments
These are the findings of the 2016 ‘SME Barometer Research’ commissioned by Exact, which is an annual survey looking at technology adoption among 2,500 SMEs across Europe and the USA.
One of the key highlights of the research was that two thirds (64 per cent) of all UK SMEs face competition from new digital players in their space. Yet, surprisingly, only 6 per cent are investing in new technology to keep up with this digitalisation movement and retain market share.
Gavin Fell, General Manager of Exact Cloud Solutions UK, said, “It’s great to see that there’s such a positive outlook among SMEs, but it’s clear that in order to deliver on those ambitions businesses need to adapt to the times. Digitalisation is going to be key to ensuring you are not only efficient, but remain competitive in today’s highly challenging environment.”
The findings also revealed that 73 per cent of UK SMEs have said they are planning to grow. Interestingly, France had particularly high growth plans with 90 per cent of businesses stating their ambitions.
Fell added: “It’s great to see that there’s such a positive outlook among SMEs, but it’s clear that in order to deliver on those ambitions businesses need to adapt to the times. Digitalisation is going to be key to ensuring you are not only efficient, but remain competitive in today’s highly challenging environment.”
The research revealed a further 56 per cent are now exploring new business models, something that is shared with their European and USA counterparts.
Some of the primary focus areas are investing in new technologies and talent. In the UK, SMEs are looking to online sales (30 per cent), partnerships and channel sales (26 per cent) and hiring talent (27 per cent) to boost their businesses. The USA is placing greatest faith in online sales (39 per cent) while Germany is throwing its weight behind new partnership agreements (31 per cent).
In terms of tech adoption, the momentum behind embracing cloud technologies appears to be gathering pace in the UK with 58 per cent now using one or more cloud tools, up from 47 per cent in the same survey last year.
This remains a priority from last year’s with many firms believing that technological changes are going to have a strong impact on the competitive landscape in the UK in the next three years.
Erik van der Meijden, CEO of Exact: “The use of technology to deepen business insight means that the wider SME economy is entering a new period of rapid growth and efficiency.
“As customer demands become ever more stringent, we are seeing entrepreneurial businesses taking advantage of digitalisation to broaden their service offerings.
“Exact provides ambitious SMEs with the technology and services they need to grow beyond their limits. As a result, companies are becoming increasingly agile, adapting to customer demands and market fluctuations in real time.”