technology for small business

Xero Conference Roundup: How Technology helps Small Business

Victoria Scally News

Many thanks to Xero – the cloud accounting software provider for putting on a fantastic conference, #xerocon. Some of the team recently attended their first show.

Our first time attending #Xerocon didn’t disappoint. We were blown away! An accounting conference doesn’t sound like the most rock ’n’ roll few days away, but here it really was.

We learned that suit jackets with jeans and trainers is now a ‘cool look’, heard from a a real life Astronaut (Major Tim Peake), were motivated (Brad Burton), listened to a grime/rap/spoken word band at 9:00am, could get a (temporary) tattoo, play cricket (!), ride dodgems, eat street food, listen to great live music, ride a fake horse and much, much more.

Sounds great, but what were the takeaways?

Alongside all this, there was some amazing insight into the technologies coming to help small businesses.

One of the key themes of the conference from Xero is that they want to help the business owners gain insight into their business through their beautiful software and through the community of other application developers.

They feel cashflow is the current most important problem to solve and many of the talks were based around discussing this problem (and how tech can help).

Some amazing (and shocking!) stats for you:
  • The average amount of money owed to small business is £23,360 (Xero Study 2019)
  • 48% of invoices are paid after their due day (Xero Study 2019)
  • Only 51% UK small business are cash flow positive each month (Xero Study 2019)
  • 50,000 annual insolvencies are due to late payments (FSB 2019)
So, what can you expect from Xero and other business support apps in the near future?
1. Further connections to your bank are coming

Thanks to ‘Open Banking’ and other innovations from 3rd parties, in the not too distant future you will be able to pay bills from your Xero cloud accounting package.

Presumably this tech may arrive later in other packages, but with Xero this appears to be coming very soon.

This is a particularly exciting feature to really help streamline paying your suppliers. Manually paying a batch of bills can be a real drain on your time. With Xero’s partnership with TransferWise this seems like a streamlined solution is on its way.

You will be able to marked your bills as paid in Xero and then the bank can handle the transactions.

2. Artificial Intelligence (AI) and Machine Learning (ML) is the future

The speakers were keen to express that AI and ML are not in a place to totally replace humans. The abilities that these technologies have are exciting for small business owners.

Many app developers are using this to streamline processes and provide insight. One particular area that has us excited is in the area of cashflow predictions, based on actual payment history. For example, traditional cashflow planning (working out what your bank balance is at any day of the next few months for example) would normally presume that if you were to issue an invoice with 30 days terms, it is paid within 30 days. Using AI and ML software can determine actual payment historic trends for a given customer and use these instead. This can then allow the app to show some valuable insights to the business owner.

3. Using tech can help you get paid faster

Payments solutions such as GoCardless (Direct Debit) and Stripe (Card Payments) are adding more ways to integrate with Xero to really be able to help get paid faster.

It’s possible to send an invoice with a ‘pay now’ button to customers and collect payments (one off or regular) through using these apps. With new changes coming it is possible for the app to save a customers card details to take reoccurring subscriptions via card, again streamlining the processing.

An example of this was one of the apps we looked at showed that businesses using it were getting paid up to 15 days faster.

4. Streamlining how you manage your business accounting admin can help the UK’s productivity problem

UK productivity has only grown 0.4% since 2008 (in comparison to the pre crisis trend of 2.3% – ONS 2019). Using apps and technology in your small business can really help drive this.

Technology such as receipt capture and integrated bank feeds can really help keep the administration time down. We’ve discussed this a few times on our BLOG.

A recent study has shown that less than 9% of business use more than 5 applications. This research shows those that embrace more than this have 4x as much revenue growth (Deloitte).

With 38% of UK small business owners being under 35 years old (Xero stat), technology is an everyday part of life so should become more of a normal part of business life.

If you would like a review or health check of your own process, please get in touch with the team – we’d love to help.