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SME’s upbeat

by Dennis Howlett on January 20, 2009

Kashflow has put out the results of a survey it conducted in December. The PDF download is here.

In summary, the respondents seem relatively optimistic:

Are you expecting to find it more difficult to pay loans and suppliers:
Yes 37% No 63%

Will you be considering reducing your staff levels? :
Yes 16% No 84%
Conclusion: Small businesses are committed to retain staff

How long do you think the recession will last? :
Less than one 6%
One Year 31%
Two years 43%
Three Years 11%
Four Years or more 9%

What will be your main focus?:
Diversification 60%
Core business 40%

As always, it is the qualitative assessment that holds the most interest. Examples:

Maria Telford from Eternal Envy Boutique in Manchester said,
“Overall our strategy for next year will be building a solid customer database, working hard on our website for online sales and being cautious with our buying as an acceptable price point for our customers has changed.”

Claire Petrie says,
“Being a new company, I do not have a lot of prior knowledge to go by.  I am almost certain sales will go up, and I am planning on spending the majority of money on Marketing and improving our market position.”

What are you clients saying? What interests me is this is coming from the customers of a ssas accounting vendor. People getting into saas are the early adopters. They tend to be more adventurous and willing to try out new ideas. Viewed in that light, you could argue that saas users are more likely to survive. That despite the fact a full 63% of respondents believe the recession will last more than two years.

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Tagged as: Recession, Small business

  • I think it's quite notable that Alastair hasn't come back with any evidence to support his claim about "app vendor makes changes that screw your business then". As I said above, that just doesn't happen. People who make claims based on assumptions rather than fact just add to the unproductive noise around the SaaS topic.

    It's heartening to see there are a number of us SaaS vendors who are seeing the same positive signs.
  • Good to hear we're not the only ones v. busy this month. We keep track of our busiest day in terms of logins. Traditioanally each Monday we beat our record. Recently we're beating our record mid-week.

    Silly amount of sign ups to our 60 day free trial with no specific promotion going on.

    Re early adopters. I think most of our customers haver never heard the term SaaS. They just asked for recommendations on accounting software or searched google -> ended up at our site and got sucked in to a free trial. Liked it, carried on using it. The fact it's web-based is incidental to the ease of use.
  • @duane - love your pitch but can you please add something of general value beyond 'Kashflow rocks' - I think we've got that message? In any event, customers decide so talk to the numbers. That would help people to understand more.
  • Underneath the fluff (bad habit - sorry!), they key point I'm trying to make is that the SaaS element is incidental. These customers are not making a consious decision to use a SaaS service.
  • Thanks for the interesting post Dennis.

    @DT
    We are also having our best month at Businessitonline.com and we are finding that many of our new customers are not what you would traditionally call 'early adopters'.

    I believe the financial and collaborative benefits of SaaS mean that all types of business owners are investigating the SaaS option because it makes good business sense.

    The climate we are in will clearly benefit products and services that help businesses to reduce costs while retaining / increasing productivity. From that perspective, the recession is likely to expedite SaaS moving maturing from adolescence to adulthood.
  • @Dennis,
    I've had more inbound enquirie for Twinfield in January thann I have had foir many months, and we haven't done any specific marketing campaigns, so my current reality definitely bares out the survey.

    @Alistair,
    I don't know of any examples in any application area where a SaaS vendor has "made changs that screw the business". I'd be interested to know what evidence you can provide. The reality is that SaaS customers are delighted with the automatic upgrade approach, and tend to be pressuring the vendor for more functionality. On good reporting and financial analysis, I think you need to look at the SaaS vendors who have good online reporting and drilldown capability, and analysis cubes across the data that plug in to Excel. This kind of thing is available now. (I'm hoping some of my customers chime in!)
  • alastair
    I believe you make your own luck in this world!

    If the app vendor makes changes that screw your business then you have nowhere to go - is what I mean. Applies to any app however delivered, but at least with non saas you get some choice about whether to upgrade!

    financial apps are still in the dark ages don't you think? Don't even get me started on UIs that are unintuitive (at best). I've been reading Tufte on charts - it wets the appetite.

    But what is really missing is reporting (I probably mean BI) and forecasting out of the box, that bolts on to the financials, and at a reasonable price, in a form that a business person can master. I thought M$ might have gotten it, but Office 2007 demonstrates not. And it is BI and forecasting where the professional starts to get an edge.
  • alastair
    I've studied this for a number of years now, and have concluded that the only common theme for successful businesses is that they are successful. Predicting success is about as successful as forecasting the weather (which I agree is simpler in Southern Spain than it is in the UK!).

    But the research is interesting, and would benefit from being extended to non-saas users.

    Personally I think the power of saas is in the collaboration model, and professionals that are able to exploit this will gain a competitive advantage, but there are still tools missing from the saas toolbox, and strategically those firms need to consider how much application control they need to make such a strategy work.
  • @alastair - I could also take that view and, to put it bluntly, say that successful people are just plain lucky. But that would be an oversimplification.

    I'm fascinated by this: "...but there are still tools missing from the saas toolbox, and strategically those firms need to consider how much application control they need to make such a strategy work" - say more - you've left me on tenterhooks!
  • alastair
    I know you are a bit of a saas evangelist Dennis, but crediting saas apps with making sme's more likely to survive is just a little bit over the top! Perhaps if they use their software to manage their cashflow then I would agree with you, but that is not a saas/non saas issue!

    However - that I guess could be a big USP for professional advisors who embrace the saas model with their clients.
  • @alastair - In my defense I was careful to say 'you could argue.' It occurred to me that the adventurous early adopters tend to be those who do better generally. Whether that's entering/creating a market, adopting technology or business models. It struck me that based on the comments reported, this particular group is probably atypical of those experiencing the recession because they're early saas users. In some cases, they are also early in the business cycle. As always, demography matters and in fairness we don't know enough about this particular cadre. Even so - indicators supported by qualitative evidence is always a good pointer. The acid test is a repeat exercise in 6/12 months' time.
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