The top admin tasks holding back small businesses
Small businesses are losing a day a week to red tape, according to a new report.
Over half of small business owners said that their company’s growth is suffering as a result of excessive amounts of business administration.
The Federation of Small Businesses (FSB) surveyed over 1,600 small business owners and found that the majority feel their business is being held back because of the amount of time they spend on business administration.
55% of those surveyed said that their company’s growth is being affected due to the amount of time they have to dedicate to business administration tasks.
The average small business owner spends over 33 hours a month dealing with internal admin, which represents almost a quarter of an individual’s working hours. This leaves less than nine hours a month to spend time on planning business development.
TIme spent on business administration per month
|Task||Time dedicated by business owner (avg)||Time dedicated by other staff (avg)||Total|
|Tax||3h 3m||3h 35m||6h 38m|
|Insurance||1h 3m||54m||1h 57m|
|Employment law issues||1h 8m||1h 16m||2h 25m|
|Pensions||56m||1h 2m||1h 58m|
|Health & safety||2h 20m||2h 45m||5h 6m|
|Business banking||5h 3m||4h 15m||9h 19m|
|Employee care/ HR issues||2h 15m||2h 58m||5h 14m|
|Accounting tasks||6h 42m||8h 3m||14h 45m|
|Other||11h 13m||11h 9m||22h 23|
|Total||33h 46m||36h 1m||69h|
Source: The Federation of Small Businesses
Owners say that this time could be best spent improving the productivity of the business, with 61% stating that they would use the time saved to focus on sales and sales development.
Dave Stallon, commercial director at FSB said: “It is a common frustration amongst owners of smaller companies that they are unable to find the time to work on their real business activities, because they are too busy completing administrative tasks, however essential they are.”
Administrative tasks are not only a productivity killer – they can also prove to be a substantial drain on funds. The report states that FSB members are currently spending an average of £3,600 on help and advice with tax compliance.
Almost half (46%) of small business leaders would hire external advisors to take care of these tasks, but at an average cost of £14,000, most simply can’t afford to do so.
The report then goes on to suggest that things may soon be getting worse for small businesses, stating that “time and money will be stretched even further by Government plans around tax reporting, announced in the 2015 Autumn Statement”.
This is in reference to small businesses and the self-employed having to keep digital tax records, reporting electronically every quarter.