Northern SMEs spend £43,000 a year on external consultants

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British small businesses – and particularly those in the north – are turning to expensive and ineffective consultants because they lack in-house expertise, according to a new report.

Research by Zeqr found that while SMEs in London spend an average of £12,000 on consultants each year, small firms in the north splash out an average of £43,000.

Northern companies also hire 43 per cent more consultants and spend an average of 48 days each year speaking to external experts, consuming their precious time.

By comparison, SMEs in London spend just 8.5 days per year with consultants.

The report’s authors said a limited pool of expertise means higher prices for external experts in the north, but even once companies find consultants they are not always satisfied.

30 per cent of those questioned admitted that they have wasted time and money on consultants. 70 per cent said the advice did not meet their requirements, 54 per cent said fixed fees were inefficient and 24 per cent said the advice was too complicated.

Meanwhile, 16 per cent said long-term contracts were required even for short-term projects and 16 per cent said the service they received was unprofessional and inflexible.

Despite this, many firms still need experts in niche fields. 49 per cent need cyber security consultants, 38 per cent need search engine optimisation advice and 21 per cent of small businesses need help building their websites and online presences.

“Our new research shows that access to experts is a postcode lottery,” said Daniel Hedlund, co-founder of Zeqr, commenting on the findings.

“Moreover, northern business owners in particular face huge financial investment to access this expertise. With businesses often relying on an existing or small pool of suppliers, this often results in less than satisfactory outcome that don’t help their bottom line.”

While businesses still need external advice on key matters, they will be hoping to reduce the amount of money and time spent on consultants and receive better results.


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