Findings by a CPA Australia survey of small and medium enterprises in the Asia Pacific that New Zealand firms lag the region when it comes to adopting new digital technologies is hardly surprising – this is a case of the Kiwi DIY spirit becoming more of a hindrance than an asset.
Gone are the days of New Zealand’s isolation. Globalisation is the norm, and so is cheap fast broadband and air airfares to Hawaii from $300. Yet the vast majority of Kiwi SME owners are stuck trying to do everything themselves, for as little as possible.
In NexGen’s experience, the three most common reasons for why so many small businesses stagnate, stay small – why every day is a hard grind just to keep your head above water – are:
1. Reluctance to spend money on technology and growth. If you don’t have cash to spare, it’s harder to let go of even a little bit.
2. A lack of specialists in New Zealand who can help address common pain points because SMEs won’t spend the money, so the work isn’t profitable.
3. Fear of letting go, fear of trusting somebody else to do the job as well as you, and fear that they’ll rip you off. The result is that owners insist on doing as much research and implementation themselves, which invariably ends in failure because there’s never enough time.
The result is that many SME owners exist in a ‘state of urgency’ when there really isn’t an excuse for it anymore because cloud technology solutions have made access to solutions easy, affordable and fast.
The danger is that not adopting new technologies is going to worsen the pain as New Zealand moves closer to a technology-based society, for instance, the IRD’s Payday Reporting, by which the IRD requires real-time payroll reporting through seamless integration with each company’s software.
The flipside is that if you bite the bullet and spend some money on a handful of technology solutions, you will free up time and, as most people will acknowledge, time is finite and far more valuable than money itself.
Here are some action steps on how to adopt technology in a way that will free up more time in your business and help you on the road to growth.
1. Identify your top three pain points
What are the three or four things that cause 80 to 90 percent of your stress? If you’re like most businesses, the real pain points – the ones that keep you up until midnight – are likely admin, cashflow, compliance and workflow planning.
Research and identify likely solutions.
2. Streamline your workflow
Find a good job management system that fits your industry. You could potentially save five hours out of every week; time you could spend with your family or offering additional value to customers.
For the hospitality sector, like small hotels, this may be Cloudbeds, or if you’re in building, trades, or construction you might want to consider an app like Tradify.
If the software is less than perfect, think about adapting how you operate to fit with the software.
3. Take the pain out of admin by automating the little things
Automating your chore-like tasks, like processing supplier invoices, can provide tremendous relief.
Auto Entry is a simple app that automates supplier invoices and receipt entry. It costs about 30 cents per invoice, but no human hand touches the bill until it comes time to pay. The invoices are automatically integrated into most accounting software packages, which is a must for some companies – like builders – who get dozens of invoices from the same supplier every single month.
If you fill up on gas, you can take a photograph of your receipt and press send. The receipt and amount are automatically added to your vehicle expenses in your accounting software – no business owner should be punching in bills to be paid at all times of the day and night.
4. Cloud accounting is a must
It is simply good business practice to have all your finances in one place and connected to your bank account.
The ability to bill your customers, pay your invoices and enjoy real-time reporting – which you should look at on a weekly basis – is a no-brainer.
Gone are the days when you looked at this stuff at the end of the year, or even quarterly, and cloud accounting is not only great for real-time reporting but it automatically and without cost stays up-to-date when the IRD introduces new compliance changes, such as Payday Reporting.
Technology may seem like a pain because it costs time and money to implement – not to mention having to learn how the system works – but like anything, if you put the effort in upfront you will reap the exponential rewards down the track.
Forget Do-It-Yourself and embrace the world of “Done-For-You” instead.