Despite concern over cash-flow within an increasingly volatile economy, many small business operators in South Africa believe their businesses will grow in the coming year – and technology will play a role, according to market research by Xero SA and World Wide Worx. But the general perception is that this role will be largely administrative and back-end focused – something accountants are best positioned to help clients redress, says Colin Timmis, head of accounting, Xero SA.

The Xero SA and World Wide Worx survey of 411 small business owners revealed that 35% of entrepreneurs are worried about cash-flow while 23% are concerned about future sales. Overall, 68% see economic volatility as their biggest challenge.

Additionally, 49% of these business owners say technology is essential to operations, while 74% use mobile apps for business daily.

Given the consistent focus on digital transformation and virtualisation as market drivers, the 49% could be seen as a low statistic.

Timmis believes it shows that when it comes to considering what technology is available and where it is likely to make the most difference to operations, business owners generally focus on the back-end administrative function.

He says it is important to clarify the term 'technology' in the context of the survey and the 49% quoted is accurate in terms of the reality of the market.

It suggests that for the most part, technology is not yet considered to be an enabler.

"Most people are engaging with technologies through their mobile devices, so their idea of technology may be limited in the sense that they are limited to say Dropbox or Googlebox, or other very well-known applications that enable them to make their internal businesses processes perhaps more efficient. What I don't think that statistic reveals or speaks to, is the very real change that we are seeing in how financial administration takes place as a result of technology, simply because people are not aware of some of the functionality that is out there."

Timmis believes the big revelation will come when business owners begin to consider technology to be more than an administrative tool and actually a core means of delivering their value proposition to clients.

"Technology has to be at the core of your offering," he says.

The Xero SA executive suggests there is a lot more education required in the market and while there is awareness around scenarios reflected in the likes of Airbnb and Uber, very little is known about their financial position. There is not much education on the technology to enable the business.

"If you think about it, where does that education take place? Are our universities and technikons delivering that level of education? If you go get an accounting degree or a business degree, to what extent is technology been incorporated in those courses? I am not sure there is a massive focus on technology or that some of the technology used is outdated," adds Timmis.

The message from Xero SA is that accountants being central to all businesses, can-and should help business highlight opportunities using digital tools.

Other statistics revealed in the research include: -

• 89% of small business owners are confident in managing their companies’ finances.
• 92% of small business owners have not missed a tax deadline.
• 89% say the small business department has not helped their business.
• 48% want the government to provide more funding.
• 43% think the government should grant tax breaks for their business.
• In 2017, small business plan to invest in marketing (36%), equipment (28%) and product development (22%).