The latest Lloyds Bank Business and Charity Index reveals that over a third of London SME organisations lack the basic digital skills that could drive growth.
By embracing digital skills, UK businesses could generate an additional £85billion in turnover according to the report. Yet only 21 per cent of London businesses are gaining a transactional benefit from trading online domestically. This figure falls further when it comes to targeting international markets, with just 13 per cent of London businesses using online channels to trade overseas.
The report also found that only 7 per cent use digital channels to search and discover growth opportunities for their business.
Worryingly, 27 per cent of London SMEs have no interest in developing their cyber security capability.
For those businesses embracing advanced technologies including cloud IT, online accounting software and digital training tools there is the opportunity to generate more than £100,000 in extra annual turnover compared to those who have none.
The benefits can go beyond finances too, with 2.5million businesses saving time through digital, more than twice as many compared to 2014. Small businesses and charities with advanced digital capabilities are able to save a day a week according to the report.
Ed Thurman, Lloyds Banking Group’s Ambassador for London, said: “As the UK’s capital, London is in a prime position when it comes to reaping the rewards of advanced digital skills. A robust infrastructure and a wide talent pool means the capital should be leading the way when it comes to adapting to the digital landscape, but it’s disappointing to see that two thirds of businesses are not investing in this area.
“With a thriving tech and start up scene, London is well-placed to accelerate development of digital skills and there are many opportunities for businesses to take advantage of. The Mayor launched a £7million programme to unearth London’s digital talent earlier this year, for example. Our report shows that over a quarter of London businesses are keen to adopt AI and machine learning in the near future and while this is a promising prospect, many of our SME businesses and charities are still lacking the basic digital skills that could help them to get off the blocks.
“We know from our work with local businesses that having a strong online presence can help organisations tap into new markets, so it’s disappointing that London SMEs are not using digital to its full advantage when it comes to trading overseas.
“With over 2,500 specially trained digital champions in London, we are helping the capital’s businesses and charities develop their skills to facilitate growth, as part of our Helping Britain Prosper plan. Over the coming 12 months we will continue to provide free to access training events for SMEs to help them close the digital skills gap.”
One organisation that has embraced digital advancements is Cera Care. The business has used Digital Analytics to more efficiently plan its care workers time, generating cost savings and increased wages for carers.