Small business owners have a lack of understanding when it comes to the benefits of carbon management for business, new research from AXA Business Insurance has revealed. Insights from a survey of over 500 UK Small and Medium Enterprises (SMEs) have shown that while nearly half (46 per cent) of respondents deemed green issues to be important to their business, almost as many (43 per cent) did not recognise their importance at all.

Moreover, results revealed that a substantial 56 per cent of firms did not believe that improving their carbon footprint would help them to grow their business. This stands in stark contrast to the 96 per cent of FTSE 100 listed companies reporting on their carbon emissions, demonstrating the importance being placed on environmental sustainability by large businesses in the UK and the increasing pressure this will push down through small businesses in their supply chains.

In order to help SMEs meet customer demand for improved environmental credentials and minimise their carbon footprint, AXA Business Insurance’s Business Guardian Angel website – which provides SMEs with the tools and advice they need to protect and grow their business – is making CarbonNeutral Footprint Reporter available to those who register on the site.

The online tool – developed by The CarbonNeutral Company and Best Foot Forward – provides a simple, accessible and low cost way for small businesses to accurately measure their carbon footprint. The solution integrates carbon footprinting, carbon neutral certification and the purchase of carbon credits, as well as providing materials to support businesses in communicating their action. Small businesses are able to immediately gain a credible, recognised certification of carbon management, enabling them to deliver tangible business benefits through competitive differentiation and increased revenue.

Douglas Barnett, head of customer risk management at AXA Insurance UK commented: “Our research goes to show that whilst environmental credentials are evidently important for businesses, there is still a lack of understanding when it comes to how they can harness carbon management action to help support their business. By making CarbonNeutral Footprint Reporter available on AXA’s Business Guardian Angel website, we are aiming to help guide small businesses in the process to measure and reduce their carbon footprint as well as enabling them to realise the business advantages which can be achieved through carbon neutrality.”

Oliver Crouch, head of strategic development at The CarbonNeutral Company, explained: “It’s clear from this research that there is still a significant opportunity for UK small businesses to realise the business benefits that managing their carbon footprint can bring. With legislation putting a focus on measuring and reporting carbon emissions throughout the value chain, and the cost of running buildings and travel programmes rising, carbon management is no longer a luxury but a business necessity. There is significant potential for SME’s to develop and grow their businesses by demonstrating action to reduce their carbon impact and through our partnership with AXA we look forward to helping them achieve this.”

This weekend is likely to see the first severe snow for 2013 and AXA Business Insurance is warning small businesses to be prepared against the problems that snow and ice can bring.

• Put together a contingency plan. Prepare for bad weather so that your business can continue to operate even if you or your staff can’t make it into work.
• If you have business premises that are going to be left vacant over the weekend or because staff are unable to make it in, ensure that the heating is left on low. Burst pipes are a huge risk once the temperature dips below freezing and can cause tens of thousands of pounds worth of damage, not to mention destroying important documents and equipment. Added to which, the clean up process can mean continued disruption to your business for several weeks.
• If you need to leave your premises unattended during poor weather, ensure you lock up properly. A savvy thief will make the most of your absence if you don’t secure it.
• Ideally, avoid driving anywhere if there is snow and ice on the roads. But if you absolutely have to be on the road for work, leave extra time and drive with extra care. The numbers of accidents in poor weather are double that of normal conditions
• And if you are out and about in your vehicle, ensure you pack a shovel, blanket, and something to eat and drink in case the worst happens. And ensure your windscreen wash is topped up, your mobile is fully charged and your tyres are fit for winter weather.
• Avoid slip and trip accidents. These accidents increase in the winter due to ice and snow. Public liability insurance will pay out if one of your customers slips on the way to visit your premises, but it’s best to avoid accidents by gritting walkways and driveways.
• If you find you have to work from home when you are normally in business premises, check that your business cover extends to equipment used in your home.

Darrell Sansom, managing director of AXA Business Insurance said: “Winter weather can mean real problems for small businesses and while the focus might be on simply keeping things going during the bad weather, there are many other potential hazards that business owners should be prepared for. We would urge people to spend just a bit of time ensuring that they protect themselves and their business as best as possible.”

 

With thousands of businesses already adversely affected by recent bad weather and flooding, new research released by RSA has revealed that small and medium-sized retailers are dangerously unprepared for interruptions to their Christmas trading period.

Following subdued summer sales, and despite almost a third (31 per cent) of those surveyed saying they are relying on Christmas to boost their annual takings, nearly half (47 per cent) of respondents admitted they are not prepared to deal with interruptions to Christmas trading. In fact, only 14 per cent feel more prepared this year than last year for business interruption, and almost one in four say they have no business continuity plan in place at all.

At the same time, small retailers appear more vulnerable to business continuity threats this year than last year, as a result of cost-cutting during what remains a tough trading climate. A fifth (20 per cent) of the retailers surveyed say they have consolidated suppliers to cut costs this year, with a third (31 per cent) admitting to relying on just one or two key contractors. Around half of retailers are also concerned about supplier deliveries (46 per cent) – likely as a result of their increased overreliance on just a handful of suppliers.

Tara Kneafsey, RSA’s SME director, commented: “SMEs in the retail sector have been planning all year for a Christmas sales boost, and many are reliant on it for survival, but failing to prepare for business interruption could quickly undo all their hard work. Perhaps unsurprisingly, two thirds of respondents tell us they are worried about the weather affecting their business this Christmas, but regardless of this are failing to protect their livelihood through robust planning.

“Adverse weather can bring businesses to a halt, with damaged property or stock leaving it unable to function, so crossing your fingers and hoping for the best is just not enough. The importance of putting in place practical preventative measures should therefore not be underestimated – for instance, an up-to-date business continuity plan can make or break your business in times of crisis.”

A quarter (24 per cent) of respondents admit they have not reviewed their business continuity plans at all this year – meaning these are likely to working from outdated plans, and that stock or equipment may be under-insured. Planning for the worst doesn’t need to be complex, though, and should match the specific needs of the business. These six simple steps can help ensure you have a workable ‘plan B’ should the worst happen:

• Identify the key elements of the business. What are the critical processes and functions? Who are your key suppliers, customers, personnel? Do you have specific equipment or machinery that you can’t function without? What are your most profitable products or services?
• Develop an impact analysis to determine how critical some of these core elements to your business are. For example, can your e-commerce business cope if your high street store is shut? Are you in a position to quickly hire temporary staff in the event of several people falling ill at the same time? Consider seasonal as well as more general business needs, such as higher stock levels needed in key trading periods.
• Use this insight to develop your own business continuity plan. This should be divided into two parts; crisis management planning and recovery planning.
• Your crisis management plan should include evacuation procedures, crucial information for the emergency services (e.g. site layout, location of hazardous substances), a list of essential contacts (e.g. suppliers, utility companies) and a pre-agreed communications path for keeping key stakeholders updated (e.g. staff, suppliers, financiers).
• Your recovery plan should cover pre-planning of the resources available to your company in case of business interruption. This might include holding lists of temporary office or manufacturing space, a reciprocal agreement with another business to use their premises in case of emergency, or details of a third party supplier who can meet the needs of your customers on your behalf.
• Once a Business Continuity Plan is in place, make sure you keep it up to date. Review it regularly – for example, are the emergency contact details listed still accurate, do you still work with the tradesmen you have on your list, or are there new ones to be added? Don’t forget to keep a copy off-site, too.

A business revolution will change the landscape for small and medium enterprises (SMEs) over the next 50 years, according to new research from Zurich.

The challenges facing SMEs over the next five decades – from a massive increase in homeworking to driverless commercial fleets – will mean radical change to the way they operate and manage risk.

The new independent study canvassed the views of more than 1000 SMEs. And their views and predictions have now been assessed alongside the business vision of best-selling science fiction writer Alastair Reynolds.

His future look into the world of work predicts innovations and challenges including the end of traditional business centres, and the prospect of robotic workers becoming the odd-job men of the future.

Findings of the Zurich research include:

One in seven say their entire workforce will be working from home in 2062

60 per cent say artificial intelligence will eventually become our trusted workplace advisers in 50 years

Half of SMEs say robotics will play a critical role in SMEs delivering services in 2062

SME Business Model of the future

The research found that over half (54 per cent) of SMEs believe the high street as we currently know it will transform in just eight years, being replaced by a ‘virtual high street’ online. 70 per cent believe traditional high street SMEs must radically change their customer experience to compete with online purchasing in 2020. While this may be the destiny for many SMEs, there are subsequent risks associated with conducting all business online. Nearly a quarter (24 per cent) say they would be concerned about the lack of customer interaction and loss of personal relationships, followed by the threat of cybercrime (20 per cent).

SMEs have predicted a similar outlook for the future shape of their business. In 50 years, 37 per cent say traditional business centres will disappear, 24 per cent say traditional distribution, such as freight vehicles, will vanish and 19 per cent believe factories will die out.

SME Workforce of the future

One in seven (14 per cent) SMEs predict the whole workforce (100 per cent) will be working from home in the future, compared to only 27 per cent of the SME workforce that is working from home today. Subsequently, over half (53 per cent) of SMEs say that by 2062 people will no longer commute to work. Despite this, 37 per cent believe that having their employees working from home will have a significant impact on their organisation, of which 16 per cent go so far as to say the very nature of their business will completely change in 50 years. While it’s increasingly likely that the SME workforce will be working from home in the future, the UK workforce will also be working later in life. On a positive note, nearly two thirds (65 per cent) of SMEs see the ageing workforce as an opportunity for their business to retain talent and experience, compared to only 21 per cent who stated it would be too risky for their business to employ an older workforce.

Inevitably, methods of communication between employees will also change. The research uncovered a dramatic shift in the ways we are set to communicate in the short-term (eight years) and long-term (50 years). For example, respondents viewed email as the primary tool for communication in 2020 (77 per cent), but usage of email is expected to halve by 2062 (35 per cent). Instead, emerging communication technology will prevail, with 68 per cent of SMEs believing telepresence will be critical to business communication in 50 years.

SME Trading in the future

When looking at trading in the global economy, some of the biggest challenges to British SMEs today are marketing to new customers and foreign trade laws and regulations. However, in future, as the online business community continues to evolve, more than one third (35 per cent) say international trade laws and sanctions are likely to be liberalised by 2062. And over a quarter (27 per cent) believe SMEs will be able to trade anywhere in the world in 50 years, with no physical presence required.

Coupled with this, 51 per cent say SMEs will be trading in one globalised currency in future, making overseas trade even more accessible. However, these global expansion opportunities also come with the realisation that the perception of some SMEs as ‘UK’ companies may vanish as a consequence.

SME Production and Services in the future

Interestingly, the production and delivery of goods and services look set to change dramatically in the future. 29 per cent of respondents predict we will all own a 3D printer in eight years, allowing us to order and print goods – this almost doubles to 54 per cent in 50 years. Robotics will also play a critical role in SMEs delivering services at home – half of respondents (50 per cent) say robotics will deliver SME services, such as plumbing, by 2062.

What’s more, robotics will also have a place in the high street. 52 per cent say shops will be un-manned, replaced by robotics, and 51 per cent say that products of the future will be transported via driverless fleets in 50 years. 59 per cent believe artificial intelligence (AI) software programmes and services will play a critical role for SMEs in 50 years, with 60 per cent citing that AI will eventually become our trusted workplace advisors.

Clearly SMEs are looking to embrace the future and harness technological advances, but more than one in three (36 per cent) are concerned by the potential future changes that lie ahead and the long-term implications on their business. 50 per cent admit that adopting new, advanced technologies, processes and services will be a significant challenge for their business in the next eight years. Despite this, nearly half (45 per cent) remain optimistic that in future the economy will have more SMEs and their importance will increase.

Richard Coleman, director of SME, Zurich, commented:

“The UK’s SMEs are already embracing change on a daily basis, with developments in technology, demographics and globalisation having profound effects on their businesses. Our research has revealed that SMEs are predicting nothing less than a seismic shift in the business landscape of the future.

“Their predictions highlight some significant future opportunities, such as the opening up of overseas trade, the ability to reach new customers and lower fixed costs due to redundant business offices. Many of these changes are happening today and will only grow in the future. As SMEs embrace this brave new world, there are also unavoidable risks that must be considered so they can remain resilient and take full advantage of the emerging new shifts. While it is encouraging that a significant number of businesses recognise the challenges and risks that they will have to face, it’s even more heartening to see that nearly half remain optimistic, predicting not only SME growth but also their importance to the UK economy and community increasing in the future.”

Alastair Reynolds, leading science-fiction writer, added: “Many of us rely on technologies and systems that only a couple of decades ago would have seemed quite ‘science fictional’ – think GPS navigation tools, or powerful tablet computers. By the same token, there are technologies coming into usage now that in a few decades will become part of our everyday lives. Telerobotic devices already allow us to interact with environments that may be the other side of town, or thousands of miles away. Feeling physically present and embodied in a remote location – and being able to move around and speak to people – will offer a vastly more immersive experience than simply using a webcam or teleconferencing system. Have no doubt, these advancements, along with artificial intelligence becoming trusted workforce advisors and driverless fleets on the road, will be little short of revolutionary for the business world.”

Local councils are jeopardising local business growth according to new research from ACCA, the Association of Chartered Certified Accountants. One in five UK SMEs said that decisions made by their local councils were having a detrimental impact on their business. Decisions regarding parking and traffic restrictions, red tape around business premises and procurement of goods and services from out-of-town businesses were all common complaints from the 500 SMEs surveyed.

The failure of councils to think local first has not gone unnoticed by the general public. In a survey of 2,000 UK consumers, almost half (48 per cent) said that councils should be doing more to help local SMEs, while a quarter (27 per cent) said they felt councils were actively hindering local SME growth.

Andrew Leck, head of ACCA UK, said, “In recent years, the UK public has been encouraged to support British businesses and now the same principle must be applied on a local scale. SMEs make up 99 per cent of all UK organisations, and our research shows that local councils simply cannot afford to ignore the ramifications of their decisions on these local businesses”.

In spite of the lack of attention from local councils, the future looks bright for many SMEs. Only four per cent of SMEs said that they would need to reduce their local presence over the coming year, while 14 per cent said that they were planning to increase their footprint and 10 percent said that they were exploring international trade opportunities.

Leck continued, “It is encouraging to see that small businesses remain positive and are looking for ways to expand and grow in the coming years – both from a local and international perspective. Councils must recognise the role they have to play in local economic development and ensure that all decisions are made with local SMEs in mind so as not to stifle this positivity”.

Despite Government efforts to encourage the UK’s big banks to lend to small businesses, only three per cent of SMEs said they were planning on approaching their bank for a loan in the next 12 months.

Leck concluded, “Make no mistake – it has become harder to secure funding in recent years, but if an SME needs an injection of cash to survive or expand then they shouldn’t be afraid to ask their bank. Speaking with an accountant or financial adviser is often the best way to identify the best means of funding for your business and how to go about obtaining it.”