Red tape costing small businesses over $20bn per year
Red tape is costing Australian small businesses more than $20.16 billion per year, new research has revealed.
The engine room of the economy may be at risk of stalling, as new research by software provider Reckon reveals the weight of administration and red tape is costing small business an average of 541 hours in time, and $14,857 in money each year.
Almost half of small business owners (46 per cent) said the admin and red tape of running their business is ‘killing the dream’ that made them start it in the first place, Reckon's In The Zone research showed.
The survey of more than 1,300 small business leaders across Australia sought to investigate the benefits and barriers to achieving peak performance – or being ‘in the zone’ – at work.
It comes ahead of the deadline to adopt single touch payroll (STP), which is the biggest compliance change for employers since the introduction of GST almost 20 years ago, and will require more frequent reporting of payroll information to the ATO.
"Most people can relate to the self-motivation idea of being ‘in the zone’ – that is, a flow state of heightened focus, efficiency and productivity," said Reckon CEO Sam Allert.
"Those that can streamline work for peak performance are not only more profitable, but they can invest more time and money in staff, marketing and innovation, to get ahead of the competition."
Over a fifth (22 per cent) of small business leaders said that the pressure of admin makes it hard for them to get ‘in the zone’ and do their best work to succeed and grow the business.
Per week, many spend more time on administration and payroll (at an average of 10 or more hours) than they do operating at their peak (an average of fewer than 10 hours).
On a positive note, Reckon’s research found nine in 10 (92 per cent) respondents were actively taking steps to get ‘in the zone’. Almost half (46 per cent) were structuring their work day by doing things like tackling complex tasks in the morning or following a strict routine; while 42 per cent proactively eliminated distractions, including turning off their email or phone.
Notably, those who achieve more time ‘in the zone’ and make time for daily admin report spending 17 per cent less on admin and payroll expenses than their counterparts. This equates to an average saving of $3,385 per year.