Only 26 percent of small businesses actually employ full-time or part-time accounting and/or legal help, according to a new survey, even though 64 percent of small business owners say that legal issues should be handled by professionals.
The survey, by small business specialty insurer Hiscox, found that small business owners admit that they lack knowledge in key areas, including legal (56 percent), taxes (36 percent), information technology (34 percent) and insurance (31 percent). Despite the potential hazards of legal and financial errors, more business owners employ a full-time communications officer than an accountant or in-house legal counsel (8 percent and 5 percent, respectively). Only 7 percent of the small business owners surveyed said they would opt for an accountant and/or lawyer if they could make another full-time hire.
The research also found that business owners regularly handle most office tasks themselves, all the way down to cleaning the office and making deliveries. Eight-three percent of the small business owners surveyed said they order supplies, 80 percent do the filing, 76 percent pay the invoices, 74 percent say they prepare the invoices, 72 percent print and bind documents, 64 percent open the business in the morning, 61 percent close up at night, 63 percent clean the office space, 50 percent handle reception duties, and 54 percent take care of customer deliveries themselves.
Thirty-six percent of the 600 surveyed entrepreneurs in the U.S. and the U.K. reported that their passion gets them through tough times, while 40 percent believe pressure is what they signed up for. However, passion could be clouding entrepreneurs’ perceptions of when they need to employ outside help for specific tasks. According to the data, 76 percent of the small business owners surveyed said that either their skills gap is not a threat or that they are able to plug the gap with professional expertise when needed.
“Entrepreneurs truly have to be a ‘jack of all trades,’ yet a clear skills gap exists between their limited knowledge in certain areas and what they are actually willing to invest in,” said Kevin Kerridge, a small business insurance expert at Hiscox. “It is important that small business owners recognize where professional expertise is imperative. Hiring or contracting support for technical sides of running a business can save them money in the long run.”
“While it’s in the DNA of an entrepreneur to just get things done, they can open themselves up to potential risks that can lead to business interruption, or even litigation if they try to handle key areas like legal, taxes, and insurance themselves,” he added. “This has the potential to unnecessarily cause a damaging domino effect on their business that could shut its doors permanently.”
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