Remote work: SMEs' cost-cutting strategy amid crunch

Economic pressure is forcing Small and Medium sized enterprises (SMEs) to revert back to remote working models to cut costs.

The latest research by Nucleus Commercial Finance indicates that SMEs are experiencing a decline in confidence, with an average score of 40.1 out of 100, where a reading under 50 represents a slip in confidence.

This drop is attributed to concerns about inflation, increasing operational expenses, and uneasy cash flow. Among the 1,500 surveyed SMEs, 79% are promoting remote work as a strategy to cut down on business costs.

This shift in approach is driven by ongoing challenges in securing funding, a problem that has persisted since traditional banks started imposing stricter lending criteria.

Andy Ward, VP International for Absolute Software, commented: “Economic pressures are unsurprisingly changing the way that businesses operate and despite enthusiasm for staff to be back in the office, the reality is that hybrid or even remote working models offer vital cost savings and flexibility. However, for remote and hybrid working to be successful, it is essential that organisations prioritise cybersecurity to ensure that devices, applications, and the company network remain secure regardless of where an employee is logging on from.”

“When managing a distributed workforce, especially in a landscape of evolving cyber threats, secure access to corporate data for remote workers is key. Organisations need to implement solutions that not only ensure strong performance, even on slow networks, but also bolster cyber defences through increased visibility into each device and application, as well as network performance. Secure Access solutions, such as Absolute’s, also incorporates self-healing software, giving the application the ability to repair and reinstall itself if it’s attacked or tampered with, ensuring IT teams are always kept in the loop when a breach occurs.”

Chirag Shah, the Founder and CEO of Nucleus Commercial Finance, states that businesses can save up to £8,000 annually for each employee working from home.

However, despite the financial benefits, the decision to work remotely still comes with its own set of challenges.

2023 UK StartUps Awards conducted a recent survey of over 1,200 businesses, highlighting 85% of startups that launched in the last three years have relied on personal capital for the initial source of funding.

Shah emphasises the importance of knowing customer needs and understanding business operations to ensure that resources are allocated for the most significant positive impact, especially during economic challenges.

Treasury Committee’s ongoing investigation on the funding disadvantages faced by SMEs highlighted evidence from banking trade body UK Finance in September.

This shows that lenders have the capacity and willingness to assist SMEs in accessing necessary finance.