News in brief: apprenticeships, late payments, innovation

News in brief
News in brief

Increased budget for apprenticeships met with approval

Following the Chancellor George Osborne’s announcement in the Autumn Statement that the Apprenticeships Levy is being increased to £3bn, MD of IGF Invoice Finance Tracy Ewen has praised the move as a “vital step in supporting the next generation of working professionals in the UK.”

Ewen said: “By introducing a business-led body and increasing funding per place, the standard of each apprenticeship should ensure high quality, on-the-job training.

“Small and medium-size businesses must use this opportunity to introduce and excel their apprenticeship programmes to give opportunities to individuals who may not wish to attend higher education, or are simply seeking a change in career. It’s important that apprentices are not used as cheap labour, or merely seen as a forgotten element of a commitment to social responsibility, but should be hired as an equal member of staff worth investing in for the long term. By passing on skills and knowledge, businesses will benefit from valuable members of staff who complement other employees - as well as the activity and success of a team.”

However, Ewen also noted that in order for the programme to be a success, the government must look to use some of the additional funding to streamline the process for SMEs to implement the apprenticeship scheme.

Culture of late payments continues to plague SMEs

According to research from YouGov commissioned to support the launch of Supply Chain Finance from PrimeRevenue and AIG, a new supply chain finance offering for mid-market, non-investment grade companies, the culture of late payments is still a serious problem for SMEs with 28% reporting that the number of clients demanding extended payments terms has increased over the last year.

The report also found that extended payment terms are impacting business growth and productivity, and significant revenue is tied up in invoices with extended payment terms.

Findings suggest that close to £29bn is currently tied up in invoices with payment terms longer than standard. In addition, businesses estimate that around 17% of their revenue is currently tied up in debtors exceeding payment terms.

Research finds business people spending £5,824 a year passing time between meetings

London-bound British entrepreneurs and business people without a London base in which to work and meet are spending £5,824 a year at cafés, hotel lobbies, bars and restaurants unnecessarily to pass time in between business meetings. This is according to new research by London’s leading business members club and meeting space, The Clubhouse, which revealed that entrepreneurs are also wasting up to three hours a week of productivity (or 156 hours a year) in cafés, hotel lobbies, clubs, bars and restaurants in between business meetings.

Whilst recent innovations in mobile technology and cloud computing allow people to work and meet in a more flexible way, contributing to a significant growth in ‘cappuccino commerce’, The Clubhouse’s research showed that in an average week, entrepreneurs spend around £700 a week in London (excluding travel) of which 16% is deemed unnecessary and simply to pass time in between meetings.

Three quarters (74%) of respondents suggested they would be interested in saving money in between meetings by joining a member’s club specifically designed for business people.

SMEs struggling to innovate due to time constraints

UK’s small and medium business owners are struggling to innovate due to competing business priorities and a lack of appropriately skilled employees, according to a new global survey by Sage.

More than a third (34%) of small business owners in the UK have neglected the development of new business ideas, primarily due to lack of time, despite small business owners working more than 40 hours a week (as revealed in Sage global research last week). One in five UK entrepreneurs attribute their long hours to the lack of appropriately skilled employees, citing this as a reason why they struggle to delegate work.

The development of new ideas was ranked as the most common area of neglect, with customer contact, staff development and bill payment also on the priority list. In a small number of countries, including the UK and Germany, entrepreneurs have said they would rather spend time on innovation than on general office administration.

The survey by Sage, the market leader for integrated accounting, payroll and payment systems, highlights some of the major challenges facing the world’s small business owners as they strive to power the global economy.