The UK’s small-and-medium-sized enterprises (SMEs) are leading the global adoption of new software technology, but only when it is absolutely necessary to do so, according to Exact.

The ‘Exact 2015 SME Cloud Barometer’ — an independent research study of just under 3,000 SME leaders across the UK, the USA, France, Germany, the Netherlands and Belgium — found those who are ‘heavy users’ of cloud software (defined as having three or more different cloud products in place) achieved far higher revenue growth and more than double the profit of those using fewer cloud products.

The study found the UK has the second highest number of ‘heavy’ cloud software users (27%), just marginally behind the USA (29%). This compares to 25% of SMEs in the Netherlands, 24% in Belgium and France, and just 10% in Germany. Overall, just under half of UK SMEs (47%) are now using at least one cloud business software tool.

Significantly, those who have embraced the cloud and are using multiple software products as part of their business processes showed on average 26% growth in revenue in 2015, compared to 14% among those using one or two online solutions, and 10% among those who don’t use any cloud solutions at all.

Although the research shows the UK does have plenty to shout about when it comes to tech adoption rates among its five million+ SMEs, there are shortcomings when it comes to optimizing working practices. Only 10% “actively look for new solutions that help us grow” — the lowest number among any of the comparison countries — while the most popular reason given for implementing new software solutions was “when we need to replace outdated versions” (54% - higher than any other country).


In terms of what is driving cloud adoption, IT cost savings is the primary reason for UK SMEs (32%) — unlike everywhere else where better security was the main reason for switching away from on-premise software solutions or traditional pen-and-paper style processes, particularly in Germany (36%). In all cases, easy access to information was cited as the third biggest benefit for moving business and finance processes online.

When it comes to financial challenges and how technology can help address those, getting customers to pay on time is the top issue facing UK SMEs (40%), followed by cash flow management (33%). These concerns are clearly justified; according to the research, 11% of UK SME’s invoices are paid late, and 2% are never paid at all. UK manufacturers are particularly affected by late payments (16% are overdue), while wholesale & distribution businesses are most affected by invoices never being paid (5%).

These financial concerns might explain why among those cloud adopters who took part in the poll, accounting software is the most popular business tool being used (27%).

“Few business leaders would argue with the fact that having the right software tools in place can be vital to success,” said Erik van der Meijden, CEO of Exact.

“In fact, 63% of the SMEs who took part said they felt that technology is going to have a strong impact on the competitive landscape in their market over the next three years.”

Lucy Fox, General Manager, Cloud Solutions at Exact UK, added: “There is a real opportunity here for UK SMEs to build on the success and status they hold on the global stage. To do so, businesses need to ensure they stay competitive, efficient and provide the very best in customer service. Cloud adoption levels appear to be growing, and highlighting the tangible benefits it can offer through research like this will hopefully encourage more UK SMEs to follow suit.”

The research found UK SMEs had the highest average net profit margins last year (2014) among all the comparison countries - an average of 20%, just ahead of those in the US (19%), but twice as much as those in France. That positivity looks set to continue with revenue growth figures for this year predicted to be 16% - nearly twice as much as expected by those in the Netherlands.