Where Shrewd SME Owners Will Be Spending Their Money In The Year Ahead

Posted on October 20th, 2017
Thought Leaders

Where Shrewd SME Owners Will Be Spending Their Money In The Year Ahead

Market fluctuations and political instability have put small businesses under increased pressure.

Xero’s State of South African Small Business report reveals that 68% of small business owners believe economic volatility to be their biggest challenge, while 62% have experienced a decrease in consumer demand this year. It’s going to be a tough year ahead.

Despite this uncertainty, South Africa’s small business owners remain optimistic with 40% expecting to see their businesses grow over the next 12 months.

This growth requires careful planning, considerable effort and investment. These are the areas that small businesses will be investing their money in over the coming months:


For 36% of small businesses, marketing is going to be the main focus during the year ahead. Instead of closing ranks and waiting out the economic storm, they will be ramping up new business activity. Even as consumer demand drops, small business owners are taking a resilient approach to growing their customer base.


To grow a successful business, you’ll need access to the latest equipment and technology. These play a crucial role in maintaining a competitive position in the market – 23% of South African small businesses will be investing in new equipment, while 18% will allocate budget towards technology.

To compete today, businesses should be as efficient and productive as possible so they can’t afford to waste time, money, skills or tasks that don’t add immediate value. The right investment in these areas can give businesses a real advantage as they improve operational efficiency, allowing employees to focus on business critical work.


To safeguard market share and grow it, 22% of small businesses plan to invest in product development. With the changing requirements of consumers, businesses need to review and upgrade their products routinely if they are to remain one step ahead.

There are some products that stand the test of time, but most must continually evolve to ensure they remain relevant.


The fact that 18% of small businesses will assign the bulk of their investment funds to customer service serves as a good reminder. No matter how good the product is, customers will only stick around if they receive a responsive and helpful service. Without loyal, engaged customers, business growth is impossible to achieve. It’s unrealistic to expect a small business to be able to invest in all five areas at once. Before deciding what to focus on they’ll require a full view of their company’s finances.

That way, they can review which aspects have provided the best return on investment and establish how much cash they have available. This is particularly the case in marketing or product development, to help them work out how to allocate their resources.

When it comes to surviving and thriving in today’s tough economic climate, small businesses need to make sure they can access all their company and client data in real-time. A comprehensive financial overview is key to making smart and fast investment decisions – and keeping your business strong and agile.

About the author: Darren Upson is EMEA Director SMBXero – cloud accounting software.