Two thirds of bosses unsure of their business’ heath
Nearly two thirds of small and medium sized businesses lack the visibility and understanding to be run effectively, new research has claimed.
ClicData found that 62% of bosses had no accurate insight into the health of their business while 6% said they had never properly looked at their accounts.
This potentially means that there could be up to 300,000 small firms in the UK who are unaware of the real state of their business.
The study also revealed that many companies are making decisions on what they believe to be up-to-date information, when in fact 60% admitted to updating information no more than once a month.
ClicData has therefore suggested that many firms lack the clear and timely insight and understanding needed, which could in turn be hampering their success.
How firms manage their key performance indicators is of vital importance yet a third of firms said they had no understanding of how their accounts were run and managed by others.
Half of businesses said they ran their work via an excel spreadsheet too, which further limits the amount of information available.
The lack of understanding was found to be even greater when financial support was outsourced in larger firms – 83% of decision makers in bigger SMEs said they lacked knowledge regarding the company accounts.
Given that around 60% of the UK workforce are employed by SMEs, ClicData has voiced concerns over their financial situations and security.
The firm suggests that many businesses could benefit by improving how they manage and access their data while they gave a warning to those who do not.
Educating staff is important as it enables them to recognise any issues that may present themselves which could place the future of a company at risk.
Those who do identify such issues should seek insolvency advice to see what solutions are available to aid them.
This process should be done as quickly as possible once any issues are found, as this should help to limit any negative impacts related to financial procedures.
By Phil Smith