The SME sector is losing out on up to £122 billion in sales by allowing marketing to slip off the radar, according to a study.
Improved marketing could create £43 billion in value added for small and medium-sized companies, according to findings by technology services company Pitney Bowes.
The company finds that the average SME is only achieving 39 per cent of its planned marketing activity, but when business owners were asked to predict the sales impact produced by increased marketing activity, results showed a growth of 9.2 per cent compared to previous years.
The research, carried out with the Centre for Economics and Business Research (CEBR), demonstrates a disparity between planned marketing activity and the reality of what takes place.
Three-quarters (77 per cent) of companies recognise that marketing is important to the success of their business, but a third rate their efforts over the last six months at under five out of ten, with 11 per cent admitting to doing none of the marketing they had planned.
Ryan Higginson of Pitney Bowes says, ‘There is a great opportunity for savvy SMEs to grab a slice of the £122 billion but to do so they must look for ways to embrace every sales opportunity and maximise profit.’
When asked what’s holding them back, SME owners cite time (21 per cent) and money (36 per cent) – the acknowledged challenges for SMEs.
Prioritisation is also a clear issue as the average owner juggles seven different roles on a daily basis and admits that buying stationery (35 per cent) is ahead of marketing (32 per cent).
More established SMEs of 25 years plus are closest to achieving planned levels of marketing, with just under a third (31 per cent) claiming to have achieved their marketing plan.
Entrepreneur Jo Behari says, ‘This research clearly shows that when marketing drops off the radar, it costs businesses significant revenue. A small business owner always has to be mindful of the bottom line and while it’s rare to carry out a marketing plan to the letter, with just 39 per cent getting done there is room for improvement.
‘Putting that extra effort in really will make all the difference to the profitability of your business, or even its survival.’