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A fresh study has uncovered new evidence on whether technology really boosts the bottom line for small and medium business operators (SMEs).
The March 2013 MYOB Business Monitor, by local accounting software provider MYOB., has confirmed that SMEs who embrace cloud computing and business websites are much more likely to enjoy rising revenue than others.
The research found that the financial chasm between the online-savvy and the online-cautious is widening, while the take up of online technologies has changed little in the past nine months.
Notably, however, respondents who said they are “in the cloud” were twice as likely to see an earnings uplift in the past year.
Of over 1,000 SMEs consulted for the study, by actioning research firm Colmar Brunton, only 16 per cent said they use cloud computing in business, up on 14 per cent in the July 2012 report. Only 38 have a business website, unchanged on July.
However, those businesses which do use cloud were 106 per cent more likely to have seen a revenue rise in the past year than those which did not use the technology, up on 53 per cent in July. Similarly, those with a website were 60 per cent more likely to see a revenue rise, also up on 53 per cent.
Business operators in the cloud were also not only more likely to see a revenue rise in the past year (33 per cent versus 16 per cent of those who weren’t), but they were more likely to expect one in the next year (37 per cent versus 28 per cent). They were also more positive about the domestic economy improving within 12 months (33 per cent versus 23 per cent).
Similarly, those with a business website were not only more likely to see a revenue rise in the past year (24 per cent versus 15 per cent) they were more likely to expect their revenue to increase in the next year (35 per cent versus 27 per cent).
Respondents said the most popular reason for cloud use was the ability to access data from whatever location they wanted (52 per cent), well ahead of other reasons.
Over one third also pointed to being able to have their team members work remotely (36 per cent), while 30 per cent said they used it because their data was better protected and safer online on external servers.
Asked what business tasks they used cloud computing for, business operators replied that the top five were: file sharing (50 per cent), file back-up (49 per cent), email (44 per cent), file storage (42 per cent), and online banking (41 per cent).
Those who didn’t use cloud computing were also asked why and the top reason was ‘I don't know enough about it to make the right business decisions about it’ (35 per cent).
Ranked second was ‘I am not very tech-savvy and don't feel confident about even starting to look at it for my business’ (22 per cent), followed by ‘It is of interest, but there are many more important other business priorities to take care of first’ (21 per cent).
Other recent MYOB research found the top three reasons why SMEs without a website hadn’t set one up were ‘we prefer to advertise and market our business using other methods’ (68 per cent), ‘it’s not a priority right now, we have all the work we can handle’ (66 per cent) and ‘we don’t see any value in having a business website’ (60 per cent).
Commenting on the results, MYOB CEO Tim Reed said the study provides solid proof that businesses should be embracing new technologies and online if they want to succeed in the changing market.
“It’s obvious that as time goes on Australian business operators using cloud computing are increasingly likely to achieve positive financial results. That said, I’m surprised fewer than one in every six say they use cloud in business. This ubiquitous technology has helped so many smaller businesses become better connected, more productive and more competitive,” he said.
“Our research findings provide a clear cut case for embracing online technologies in business. The latest study reveals SMEs using cloud were twice as likely to see a revenue rise in the past year than those who aren’t. It’s similar for those with a business website, who were almost two thirds more likely to see a rise than their peers.
“It’s also clear the majority are unaware of the value in having even a simple website that contains their contact details. Many businesses have first-hand experience of the benefits of being found online, being able to attract and retain customers in this way. Our research proves it can have a tremendously positive financial effect.”