As the world evolves, there are countless ways for businesses to grow. Technology is a great innovator, for instance, and many are looking to get ahead by investing in new hardware, software and machinery.
Meanwhile, the modern business environment has grown from its simple roots of local people running market stalls, thanks to an environment that promotes globalisation. Like never before, small to medium-sized enterprises (SMEs) can expand out of the local market and have a national or international presence.
However, as the old saying goes "something's gotta give". The Economist Intelligence Unit (EIU) recently found that as businesses continue to grow, the level of complexity is becoming overwhelming for most.
In an October 2015 survey, more than half of executives (55 per cent of them) said complexity had caused a dip in their business's profits over the past three years. One in 20 even said the reduction to their bottom lines id "significant", impacting their abilities to continue operating at all.
It is a problem that many are yet to confront, as they juggle their responsibilities of managing a workforce, investing in new assets and, of course, balancing their books. The latter is perhaps one of their most pressing problems, with keeping a steady cash flow so important to continued business success.
What's the problem?
If you're forever untangling a ball of yarn, you're not going to get much knitting done. In the same way, 22 per cent of surveyed executives say they spend as much as a quarter of their time managing complexity instead of getting things done.
The five biggest impacts of which, the research showed, were:
- General management (29 per cent of execs said this are of their business was most affected)
- Employee relations (23 per cent)
- Customer service (21 per cent)
- Governance and compliance (19 per cent)
- Product development (18 per cent)
In short, over-complexity is everywhere. All is not lost, however; cutting the effects of time-sapping tasks in half could save employees between 3.7 and 7.5 hours each and every week, the EIU found. For SMEs with limited capital, that's a fine amount to put back into the bank account.
One way to cut complexity
So, how can businesses become less convoluted? There's no doubt that as business complexity has risen, the popularity of outsourcing has grown, too. When it comes to the complicated and time-consuming nature of finance, reducing both admin and approval waiting periods is becoming a smart choice.
Debtor finance, for instance, is the process of paying businesses for their outstanding invoices, putting the responsibility of finalising them onto the debtor finance provider. With financial matters infamously complex, it's a quick and simple way of tidying up your payments, while keeping cash flow in check.
The year 2015 was a great year for debtor finance, with more businesses flocking to the finance solution than ever before. If you want to chat about exactly how it works, contact our team today on 1300 760 205.
If you'd like to learn how Earlypay's Invoice Finance & Equipment Finance can help you boost your working capital to fund growth or keep on top of day-to-day operations of your business, contact Earlypay's helpful team today on 1300 760 205, visit our sign-up form or contact [email protected].