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In what was an unexpected finding given the technology now available, Cloud accounting company Xero recently released compelling analysis which revealed that more than 51% of Australian small and micro businesses are still using a paper-based system to manage their invoices and receipts.
Uncovered was the alarming statistic that the average small business is racking up around 100 pieces of bookkeeping receipts and admin per week, but 77.6% of these businesses are storing these dust gathering pieces of paper for later reference.
The survey examined how paper-based systems can impact various aspects of a small business. Although there is a large array of digital gizmos and gadgets to help small businesses improve their efficiency, a considerable proportion were found to still physically stockpile receipts and invoices, and more than half of those respondents admitting that their filing system isn’t systematic. The research also found:
> 65.2% store at least some of their receipts/invoices in boxes or files, while more than 28.9% manually store all receipts/invoices
> small businesses are incurring considerable expenditure on paper administration, with 12.7% spending more than $1000 a week on paper admin costs such as printer ink, paper, scanning, shredding, storage and 3% spending more than $5000 per week.
> 7% of small businesses have no storage system at all for their receipts and invoices
> 38.8% of small businesses spend several hours a week processing receipts and invoices, with the average churning out up to 100 per week – totalling 5200 per year,
> 15% of businesses process up to 200 receipts and invoices each week.
Of the small businesses surveyed who are still using a paper-based admin system, almost half of those had been running their business for more than 10 years.
By contrast, small businesses that had been running for one to three years represented just 8.4% of businesses using paper systems.
This data highlights that many Australian business owners aren’t using the available technology to improve day to day basic administration functions for their businesses. Utilising even basic technologies can reduce considerable time on mundane and time-consuming tasks for business owners, and reduce opportunities for improving and working on other sections of the business.
If you would like to discuss ways in which you can increase your business efficiency and reduce time spent on menial administration tasks, please feel free to contact us for a discussion. We are leading small business bookkeeping experts in Melbourne.
Disclaimer: The information on this site is of a general nature only. This is not a recommendation or endorsement of any product or investment. It does not take your specific needs or circumstances into consideration. You should look at your own personal situation and requirements before making any financial decisions or consult the advice of an accountant or financial adviser.