With gloomy economic forecasts preceding the new year, will small- and medium-sized enterprises lagging in ‘digital smarts’ finally up their game?
As consumer markets normalize in the “endemic phase” of pandemic management, economic headwinds now and into 2023 will keep small businesses on their toes as they face ongoing challenges with inflation, market volatility and general uncertainty.
Having a clear picture of their business health and cash flow, along with optimizing resources and increasing operating efficiency will all be key to staying relevant, competitive, and growing in 2023.
Here are three other trends that small- to medium-sized firms (SMEs) should monitor and address:
More SMEs than ever will turn to cloud-powered solutions to optimize resource management
Next year, more SMEs will turn to technologies like AI, ML and automation to optimize their resource management, utilizing affordable and reliable cloud-powered apps and platforms.
For example, Yoga Movement, has automated and streamlined accounting processes such as data entry and bank reconciliation with cloud-based accounting software. They are now able to generate month-end reports in two weeks compared to eight previously. Having a bird’s eye view of its cash flow and financial health has additionally enabled the business to allocate resources and investments more effectively, such as adjusting sales and attendance campaigns to meet their targets.
Upskilling and reskilling will increasingly become the backbone of business resilience
With today’s constant references to impending super inflation and even stagflation, businesses will focus on ensuring that their employees are sufficiently skilled to truly maximize their digital resources. In Singapore, a study by the Singapore Institute of Technology (SIT), RSM Singapore and the Institute of Singapore Chartered Accountants (ISCA) suggests that seven out of 10 SMEs surveyed were seeking more support in upskilling their staff.
For example, business advisory Agere’s upskilled staff helped the firm to leverage strong business insights from their digital solutions to help clients turn losses around in just three months.
Cost stabilization will mitigate macro-economic pressures
Geopolitical turmoil, global supply chain disruptions, foreign exchange volatility, and inflationary pressures have made it difficult for SMEs to accurately forecast costs and expenses, compromising their ability to plan feasibly for the future.
To introduce more certainty into their businesses in 2023, such firm can ramp up efforts to monitor their cash flow in real time and build greater certainty and transparency into their cost base, where possible.
When beauty brand Luxe Botanics diversified its market footprint and amplified its online sales channels during the pandemic, cloud solutions were instrumental in helping their leadership to navigate the new financial and administrative complexities arising from increased sales volumes and payments across geographies, while supporting their business growth by streamlining operations and managing multi-currency transactions and invoicing.