Responding to business challenges
In a research report commissioned by Forum that examined and quantified how the operational expenditure of SMBs and mid-market companies impacts business growth and productivity, it was revealed that two in five SMEs have decreased the number of sites they operate across, or let staff go, just to manage supplier cost fluctuation.
We know that the cost of doing business is increasing, and the strain this is putting on business, particularly SMEs, is leading companies to look for new ways to make the most of their operating expenditure to better manage inefficiencies. And we understand that trying to manage supplier costs can often stifle business growth and distract business owners and managers from their core business.
The survey of 453 businesses also found that 66 percent of respondents have seen employee head count restricted or profit margins decrease due to the impact of increased operating expenditure.
Whilst this is a normal method of dealing with high operating costs and while effective in the short term, we understand that businesses are still left feeling like they have little control or impact on other costs. Energy, staff, IT and property costs are increasing and people see these as uncontrollable expenses. While this is true, the trade-off is jobs, innovation and customer service.