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Red tape is still one of the biggest bugbears of small businesses, says a new survey – despite the Government’s promises to drastically reduce it.

Red Tape Costs 4 Work Days Per Month

The survey by the Federation of Small Businesses showed that UK small business owners spend an average of 33 hours per month on internal business administration, meaning they lose around 4 working days a month dealing with red tape.

FSB Commercial Director Dave Stallon 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.”

Time-Sucking Tasks

The Government’s Cutting Red Tape initiative doesn’t seem to have made much of an impact as yet. The research done by the FSB showed that around 70 employee hours per month are spent on administrative tasks, with the three greatest time suckers all involving financial administration: accounting (15 hours), business banking (9 hours) and tax (7 hours)

So how can small businesses ease their administrative burden?

The Cost of Expert Advice

Dave Stallon advises passing these tasks on to others.

“These businesses need expert support they can trust in order to minimise time dedicated to business administration,” he says. “If they do this, they can maximise the time spent making their businesses bigger, better and more profitable.”

61% of those surveyed agreed they could make better use of the time they spent on admin, spending it instead on sales or development, and 46% said they would hire external advisors to help them with administration – if they could afford to. And there’s the rub; outsourcing administrative tasks costs the average small business nearly £14,000 a year. FSB members have previously revealed they spend an average of £3,600 on tax compliance advice and assistance alone.

Unfortunately, this only confirms what all business owners already know: time is money, and it’s rare to have enough of either to make the most of the other.

 

 

About The Author

Karl Bilby

We work very closely with our expert accountants to bring you the latest factually correct tax and accounting news. We also enjoy writing about small business news that we hope you find useful!

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