A ‘lack of time’ is costing the average small business £4,000 every year.
A study of 500 SME owners and decision makers highlighted a lack of time to focus on all their expenditure is costing them nearly £350 each month on average – and 9% worry they are unnecessarily spending between £1,000 and £3,000 each month.
The survey also revealed 68% of small business owners haven’t changed their approach to managing expenditure for a significant time.
But almost nine in 10 (89%) are open to taking on a new approach, and 57% say they are embracing new technologies to manage business finances and enhance productivity.
The research found 26% don’t have enough time to give energy bills their full attention, and 20% wish they had more capacity to focus on software and tech.
And a ‘forget-to-cancel’ culture, where a lack of time means regular subscriptions rollover without being reviewed, was another reason why 24% felt they had higher outgoings.
The outgoings small business owners believe they could save money on if they dedicated more time to reviewing them include energy costs (31%), insurance premiums (23%) and broadband (20%).
The research was commissioned by Smart Energy GB, which is working with Mowgli Street Food founder and TV presenter, Nisha Katona MBE to share The Accuracy P.L.A.N.: Why It Pays To Know Your Bills, a free resource to help small business owners navigate their way through their business expenditure.
Nisha Katona said:
“Small business owners have to navigate their way through endless expenditure and keeping a close eye on bills is critical to a business’s success. When I started my business, I had so much to juggle that I didn’t really put my mind to my energy usage but if I had, I could have saved so much more money.
“Getting smart meters installed in my restaurants helped me, and my team, to better understand our energy usage, which in turn has helped me change the way I run my operations, and have more control over our energy spend.”
The research also found 41% of owners have paid for unused subscriptions, costing the business money.
Two fifths (39%) say they missed renewal notices or forgot the subscription existed, with nearly half (45%) saying it was of so little value it was overlooked.
When it comes to keeping on top of business finances, key challenges for small business owners include being responsible for too many tasks (33%) and the volume of admin (31%).
A further 30% struggle to ensure employees follow a process to accurately track business spend.
There’s a significant emotional toll for 41% of owners who have five or more sleepless nights on average a month, while 28% are feeling ‘stretched’ daily.
Energy bills topped the list of costs that worry owners the most (43%), yet 22% say it’s been over a year since they reviewed their business energy supplier.
A third of small business owners believe a simple monthly process would help them manage business costs more effectively, as well as regular comparison checks against other supplier costs (33%) to get the best deal.
COSTS BUSINESS OWNERS THINK THEY COULD SAVE MONEY, IF THEY HAD MORE TIME TO REVIEW THEM
- Energy costs
- Insurance premiums
- Supplier costs
- Technology and software
- Marketing and advertising
- Equipment and maintenance
- Broadband
- Professional services e.g. accounting
- Office supplies
- Subscriptions
Nisha’s Top Tips for Restaurant owners
1. Set clear goals
Whether you’re aiming to increase profits or cut costs, setting clear goals gives you a roadmap for success. Maintain accurate financial records and closely track all your expenses, including energy costs. This will save you time and money in the long run, so you can focus on what really matters – growing your business.
To get started, download The Accuracy P.L.A.N.: It Pays To Know Your Bills, a free resource to help small business owners navigate their way through their business expenditure.
2. Encourage energy saving habits
Implement simple energy-saving practices like setting timers on lights and turning off appliances to avoid wasting energy when they’re not in use. At Mowgli Street Food, we started coming in a little later in the morning, which saved energy as we reduced the hours we were in the kitchen with the lights on and the ovens running. Keeping vents and equipment clean ensures they run efficiently.
3. Educate your team
Teach your team good energy habits. It’s important they’re on board with your energy saving measures and understand the cost of energy and how even small changes in behaviour can make a big difference to an energy bill. They may also have their own ideas too.
4. Get a smart meter installed
Smart meter data can help give you more control over your business’s energy spend, and help you monitor energy usage and identify where you can make some cost savings.
5. Invest in energy-efficient equipment
While the initial investment may be higher, upgrading to energy-efficient equipment can lead to substantial long-term savings. These appliances consume less energy, reduce operational costs, and contribute to a smaller environmental footprint.
