Why technology is powering pandemic recovery plans for Australian SMBs

Running a small or medium-sized business (SMB) has never been more challenging. The COVID-19 pandemic continues to have a significant impact, with many business owners and managers accelerating digital strategies in response to the crisis.

They still need to attract and retain customers, hire and train employees, reduce costs and manage cash flow, and find new ways to stay ahead of the competition. It’s a challenge at the best of times. Digitisation offers benefits that these businesses simply can’t afford to miss out on in the current environment.

This includes everything from reducing regulatory burdens and increasing productivity to improving customer satisfaction and expanding into new markets. The effective delivery of change will be key to survival for some companies.

The pandemic has forced many SMBs to adopt new technologies, because digital channels have been the only way to reach customers. With states going in and out of lockdown, retailers have looked for new customers online, gyms have switched to online classes and restaurants have adopted e-commerce takeaway and delivery models.

E-invoicing could save SMBs $40,000 a year

E-invoicing is earmarked as an important focus area of digital transformation, with the Australian Government investing $15.3 million to increase awareness and adoption. It also makes financial sense for businesses as e-invoicing is much more cost effective. With a Deloitte study estimating that e-invoicing would deliver savings of up to $20 dollar per invoice for those who make the switch.

SMB – defined as those employing 1-199 people – process an average of 168 invoices per month. Over the course of a year, this means switching to e-invoicing would deliver savings of up to $40,320*. Payment times and security are also improved.

For its part, the government announced late last year that federal agencies will process all invoices electronically by the end of June 2022. These agencies are now paying small business invoices within five days – good news for the cash flow of suppliers they work with.

The NSW Government has since announced that it will move completely to e-invoicing by 1 January 2022. Other states are also working through their approaches.

SAP has taken a closer look at the current state of digital transformation and how best to support SMBs in driving this trend forward. In our research paper – The Connected SMB: Embracing digital strategies to fuel growth – increased efficiency and greater productivity were the main drivers for those considering the switch to e-invoicing.

With 88 per cent of SMBs that have already switched to e-invoices reporting that it was easy to make the switch, owners and managers are looking at other opportunities to update existing business processes. Those getting a taste for digitisation say other priorities include payroll, forecasting, debt collection, customer experience and talent management.

How to get started on the path to digitisation

SMB owners shouldn’t feel like they are alone on this journey. There are many sources of support ready to help them overcome hurdles and make the most of opportunities by sharing experiences and advising on the best approaches for their business.

Companies are looking to external sources for help in their transition to digitisation, with about one in three taking advice from consultants, and a similar number asking IT companies or governments for guidance.

Start by doing some research to find out what’s likely to have the most impact and, if possible, learning through others who have been through the process.

It’s best to involve staff and suppliers in the decision-making process, especially if the changes could result in new ways of working. Be sure to choose a technology partner that fully understands your business and objectives, commit to the process, learn along the way and keep moving forward.

Read the full report here for further findings. Ready to start your transformation journey? Get in touch with SAP.

*This average saving was generated by multiplying the average 168 invoices per month x 12 months x $20 saved per invoice = $40,320