Kiwi small businesses could be set for a tech-fuelled boom, according to a new study. A Microsoft report on New Zealand SMBs has found that local businesses could radically enhance their growth and profitability with a relatively small investment in IT.
While it’s widely understood that technology is essential for running a business, once more entrepreneurs realise its potential as a growth engine, the economy could potentially find a new gear.
The 2018 “SMB New Zealand Landscape Report” conducted by Capitalis on behalf of Microsoft revealed that 87 per cent of businesses with fewer than 100 employees felt that IT was critical to running their businesses. When it came to growing their businesses, that figure dropped to 67 per cent.
Microsoft New Zealand head of marketing Chris Dick says, “Given that the top three challenges identified by New Zealand small businesses were the increasing cost of materials and compliance, increasing competition and regulatory changes, there’s huge opportunity to see real improvements.
“A small upfront investment in the right IT solutions can help lower operating and compliance costs, monitor regulatory requirements and boost a business’s visibility and competitiveness.”
Across the board, businesses are looking to improve profitability and productivity while reducing costs. Investing in up-to-date PCs, mobile platforms, cloud computing services or smart technology like machine learning and AI may seem counter-intuitive, but the ongoing cost reductions can save businesses far more than they spend.
“Given rising costs, widespread labour shortages and greater competition, technology is increasingly a critical factor in business growth and also boosts resilience in the face of disaster,” Dick says.
A 2018 study by Techaisle for Microsoft found that the cost of running PCs older than four years was more than $4,000 (US$2,736), thanks to longer wait times, more repairs and weaker security leading to a higher incidence of data breaches and downtime. Simply investing in good cybersecurity and disaster recovery strategies can help businesses save money in the long run and avoid potentially fatal setbacks.
Downtime costs small businesses nearly $30,000 (US$20,000) per hour, which having good remote backups can prevent. Flexible working can also assist in business recovery. One in five New Zealand SMBs were impacted by a cyber attack in 2017, costing them an average of $19,000.
Meanwhile, events such as the Christchurch and Kaikoura earthquakes show the effectiveness of storing data remotely and enabling employees to access work systems from anywhere.
Dick says a trusted IT partner can also help businesses stay on top of regulatory change by monitoring payroll, procurement and even building layouts to ensure activities are compliant with local rules. This frees up staff to focus on their core business rather than red tape, enhancing both a business’s productivity and profitability.
Dick concludes “IT is not only essential to running a business – as a driver of growth, it’s the most powerful tool there is. The good news is that even small changes, such as building up your online presence or trading in your office PC, can bring rapid benefits.”