SMBs look to tech, confident of a promising future

In particular, small and medium-sized businesses (SMBs) have had to battle challenges such as economic decline, soaring costs, supply chain disruptions, and shifts in labour markets.

Those higher costs have been driven by the increased price of utilities, salaries and raw materials, and has – according to our research – directly challenged the viability of 1 in 5 SMBs.

However, despite these obstacles, a remarkable trend of increased positivity has emerged among SMBs, as revealed by the recent global study conducted by Sage, ‘Small Business, Big Opportunity‘.

It reveals that 84% of SMB business decision-makers globally expressed unwavering confidence in the future success of their companies, marking a significant rise from the 69% reported just a year ago.

In fact, SMBs around the world are choosing to view the problems of 2022 as transitory and are optimistic about what’s next for their businesses.

What fuels this confidence? It can be attributed to strategic investments made by SMBs in cutting-edge technology, state-of-the-art equipment, and the best human talent – which have, in turn, paved the way for streamlined operations, time saved, and substantially reduced costs.

Another factor is the positivity shared by global SMBs towards their growth prospects for the upcoming year, crediting their relentless pursuit of cost reduction, ability to attract exceptional talent, and commitment to improving productivity as the key elements enabling them to weather the storm of rising expenses.

Adoption of tech is critical to enhanced productivity and adaptability

It’s clear that the value of tech in driving growth, enhancing efficiency, and unlocking untapped potential is being widely recognised. Investing in equipment or tech emerged as the most effective adaptation for increasing confidence 16%, enabling more SMBs to save time and enhance productivity.

Moreover, South Africa business owners are increasingly recognising the value of tech, with more than half 53% of SMBs intending to increase their investment in tech in the coming year.

It’s encouraging to see this support of tech across the board. SMBs in 2023 clearly already benefit from automated processes and up-to-the-minute insights into their business operations.

Yet emerging tech brings with it new opportunities. By using AI to automate processes, increase data visibility and expand connectivity, people are changing the way they work both within their jobs and across a wider ecosystem of customers, suppliers, employees, and governments. In turn, creating a new era of more intuitive business.

It’s a future we call the Digital Network, and our report shows that SMBs are already getting behind this vision.

Paving the way to sustained growth

Looking ahead, SMBs in South Africa must continue to embrace tech as the bedrock of their operations. The rapid advancements in AI, digitalisation, and online tools offer boundless opportunities for growth, enhanced efficiency, and a competitive edge.

By harnessing the transformative power of tech, fostering a culture of collaboration, nurturing exceptional talent, and investing in skills development programmes, local SMBs can position themselves for sustainable growth, navigate future disruptions with confidence, and play a pivotal role in driving the overall economic recovery.

The findings of our most recent study emphasise the need for a collective call to action from both industry stakeholders and government bodies. The private sector must rally behind SMBs, provide firm support for their adoption of tech and foster collaboration among industry players.

Meanwhile, governments should introduce and deliver targeted policies, offer incentives, and allocate funding to encourage further advancements in tech.

It’s encouraging to see signs that this is already happening with government support through investment in technology studies by providing scholarships, and continued support of institutions providing free tech short courses.

By uniting forces, we can create an environment that not only promotes and supports the growth and success of SMBs but also drives economic recovery for a positive future.

By: Pieter Bensch, Executive Vice President for Sage Africa & Middle East

About Sage   

Sage exists to knock down barriers so everyone can thrive, starting with the millions of Small and Mid-Sized Businesses served by us, our partners, and accountants. Customers trust our finance, HR, and payroll software to make work and money flow.

By digitizing business processes and relationships with customers, suppliers, employees, banks and governments, our digital network connects SMBs, removing friction and delivering insights.

Knocking down barriers also means we use our time, technology, and experience to tackle digital inequality, economic inequality, and the climate crisis.