UK economy loses £37 billion every year through poor spending controls, says Soldo
By Megha Bhattacharya
European pay and spend automation platform Soldo today revealed data from a Coleman Parkes study stating that the UK economy loses around £37 billion a year through poor business spending controls. Not just the UK, weak spending controls were reported to be costing European businesses £301 billion, with businesses in Germany losing £54 billion a year, while France and Italy also reported sizeable figures (£37billion and £26billion respectively).
The study ‘A Brighter Future: better Spend Controls Key to Economic Recovery’, conducted by Coleman Parkes, of 900 finance and business leaders across the UK, France, Germany and Italy highlighted the contribution of poor visibility, over-spending and duplication of spend to limiting organisational growth.
“Although many businesses in the UK are struggling to manage cashflows in this exceptionally challenging economic landscape, we see that many are losing significant revenues on an annual basis simply through poor management of spending,” said Carlo Gualandri, CEO. “Looking at this loss of revenue at a macro-level, the numbers are quite staggering.”
The research showed that over £19 billion is lost each year in unclaimed VAT across the UK, of which around £3.8 billion is lost due to errors in the way receipts are processed. 40% of UK businesses say that bad financial practices have led to unnecessary spending, and 29% report the duplication of costs.
Soldo’s analysis has also pointed out that 45% of payroll tasks, 49% of receipts/invoices obtainment and management and 41% of data copying into accounting systems are still paper-based processes and demand some kind of physical process. “Businesses that create efficiency and help teams to delegate the responsibility for spending to anyone in the businesses will be key to a swift return to growth. Technological adoption will empower business leaders, armed with better data and real-time information around spending, tech-enabled businesses are much more confident in their ability to invest for future growth,” concludes Gualandri.
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