Thirty per cent of IT and telecoms SMEs say that the cost of investing in technology, upskilling their workforce and using technology for business efficiency are their biggest challenges in 2024.
That’s according to Dojo's Tech SME report, which found that It founders have borrowed more than £95,000 to support their businesses.
The most common forms of borrowing were private loan (thirty four per cent), followed by personal credit card (34 per cent) and then friends (32 per cent). Twenty three per cent of SMEs went to their families for additional funds over crowdfunding (19 per cent).
The report also revealed that 39 per cent of tech SMEs have had to optimise bills, such as electricity and water, to cut costs and 35 per cent have shut down offices due to the current market conditions.
This likely comes with the shift to flexible working since COVID, where more employees are working remotely and fewer are working from offices.
SMEs choosing to shut down offices also means less is spent on overheads like electricity and workspace rental.
However, only 1 per cent of IT and telecoms SMEs haven’t considered any cost-cutting measures in 2024.
Added to that, the report found that more than one on five tech SMEs say staff retention is their biggest challenge, while 23 per cent cite hiring as the key issue.
This could be due to other companies offering better benefits in terms of pay and perks to attract new staff.
More than one quarter (26 per cent) of tech SMEs have also had to make redundancies as a result of the current business climate, in order to cut business costs, the study has revealed.
Despite having to cut costs, more than three quarters (79 per cent) of tech SMEs are anticipating growth in revenue and profits.
Also, more than 80 per cent of businesses have an emergency fund in place in case of any unforeseen circumstances or expenses.