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Sage survey ‘Sweating the Small Stuff' shows the cost of admin on SMEs

04 October 2017

‘Sweating the Small Stuff: the impact of the bureaucracy burden' is research commissioned by Sage highlighting the impact of administrative tasks on Small & Medium Businesses globally

Research finds Australian businesses spend up to 81 working days per year on administration in comparison to 120 days spent by the world’s business builders

4 October 2017 – Sage, a market leader in cloud accounting software today unveils an economic report highlighting that the world’s business builders currently spend up to 120 working-days per year on administrative tasks, accounting for up to 5% of the total manpower for the average Small & Medium Sized Business. This figure is slightly lower for Australian businesses who spend an average of 81 working days per year on admin. The cost spent on administrative tasks for Australian businesses is approximately $81,000 per year coming in just behind Singapore ($150,000), the USA ($95,000) and Germany ($93.000). 

The markets surveyed include Australia, Brazil, Canada, France, Germany, Ireland, Singapore, South Africa, Spain, the UK and US. Sage has over 3 million customers – small and medium sized enterprises in 23 countries, including the surveyed regions.

Undertaken by Plum Consulting, the research shows that an increase in productivity of 4.9% in Australia could lead to an increase in GDP of at least $31.8 billion per year.  This could be partially achieved through the reduction of time spent on business administration.

The largest administrative task for Small & Medium Businesses in Australia is accounting, with operational tasks such as recruitment and HR representing a smaller burden for entrepreneurs.

‘Sweating the Small Stuff: the impact of the bureaucracy burden', researched more than 3,000 business builders, including almost 300 in Australia and found that complying with administrative and regulatory requirements has a significant impact, both in terms of manpower that must be devoted to the tasks and the actual cost to the bottom line.

Of the administrative tasks analysed, the report finds that time spent by Australian businesses on accounting is most costly, amounting to almost 27% of total administration time. Tax specific accounting counts for an additional 15% of admin while payroll management covers about 7%. 

Elaine Seeto, APAC Marketing Director at Sage, said, “Small & Medium Businesses are the lifeblood of the Australian economy, accounting for approximately 67% of all employment. This research finds that staff productivity is being taken up on administration  – imagine how we could benefit by removing this burden and replacing it with productive tasks like, winning clients or improving products. We’re committed to find ways to enable business builders to manage everything from money to people digitally, in real time and in the cloud.’

Global snapshot: Small & Medium Businesses’ Contribution to Global Economy

Across the 11 countries analysed Small & Medium Businesses account for at least 96% of total enterprise, so if lost time was given back to them, the impact on GDP would be appreciable

Country

Percentage of time lost to administration

Implied loss in productivity

UK

5.6%

GBP 39.9 bn

South Africa

3.7%

ZAR 7.3 bn

France

7.7%

EUR 43.9 bn

Ireland

3.5%

EUR 2.2 bn

Australia

4.9%

AUD 31.8 bn

Brazil

6.5%

BRL 79.5 bn

Canada

1.7%

CAD 17.7 bn

Singapore

5.5%

SGD 10.1 bn

Spain

10.5%

EUR 32.0 bn

United States

4.9%

USD 335.3 bn

Germany

3.7%

EUR 28.2 bn

Get the full report now

Source: Sweating the Small Stuff: the impact of the bureaucracy burden

About Plum

Plum Consulting is an independent consulting firm, focused on the telecommunications, media, technology, and adjacent sectors.  We apply extensive industry knowledge, consulting experience, and rigorous analysis to address challenges and opportunities across regulatory, radio spectrum, economic, commercial, and technology domains.

A London-based partnership founded in 2007, Plum works for governments, regulators, service providers and equipment suppliers around the world. Its advice is based on rigorous economic analysis and specialist technical knowledge of radio engineering, which it combines with extensive market knowledge of the communications sectors to provide clear and sound analysis.