A new study by European pay and spend automation platform Soldo reveals UK businesses lose around £37bn a year through poor business spending controls. The concerning figure is equivalent to 2 per cent of revenues for every business in the UK, with losses starting at around £50,000 for small businesses, rising to around £12m for the biggest UK firms.
CEO of Soldo, Carlo Gualandri said, “Although many businesses in the UK are struggling to manage cash flows in this exceptionally challenging economic landscape, we see that many are losing significant revenues on an annual basis simply through poor management of spending. Looking at this loss of revenue at a macro-level, the numbers are quite staggering.”
The study points out how poor visibility, overspending and duplication of spend are the biggest contributing factors to limiting organisational growth. It also reveals that over £19bn is lost each year in unclaimed VAT across the UK, of which approximately £3.8bn is lost due to errors in the processing of receipts.
Gualandri said, “Finance functions need to transform to drive business results, too much time and revenue is being wasted because of inefficient practices that are holding finance teams back. After all, it is these teams who are ideally placed to provide the strategic insight that will enable the company to thrive in the wake of Covid.”