New research by Start Up Loans, conducted by YouGov, reveals less than half (46%) of small businesses use AI at work. Furthermore, a third (34%) of small business leaders only have a ‘basic understanding’ of AI tools.
On average, only 12% would refer to themselves as ‘expert’ in the technology, when thinking about their proficiency in five core pillars of AI: Generative AI, chatbots and virtual assistants, speech to text and vice versa, text analysis and summary, and AI-powered text editing.
The biggest barriers to further AI adoption were found to be IT security issues (25%) and a lack of appropriate financing possibilities (25%). A slow internet connection (22%) was the third largest barrier.
There is also a knowledge barrier preventing many small businesses from reaping the full benefits of tech and AI in the workplace. Over a fifth (21%) of business leaders cite insufficient digital skills of employees as being problematic, while a similar percentage (19%) cite an internal resistance to change as a hindrance. These barriers and lack of understanding are leading to a delay in uptake of the technology.
Within smaller businesses there was a clear divide between those at the larger end of the spectrum and those at the micro end when it comes to using AI. The survey found AI is used in 36% of micro businesses (0-9 employees) and 44% of small businesses (10-49 employees) but rises to 60% of medium-sized enterprises (50-249 employees).
One business owner who is bucking this trend is David Bolton. His business, Cuttz Cartel, specialises in making stickers, vehicle and window decals and product packaging.
David, who took £10,000 form the Start Up Loans programme, is using AI to help fine tune the design of these stickers.
David said: “When you’re running a small business one of the biggest things you have to wrestle with is time. Anything that can save you time is incredibly useful.
As my order book grew, I found myself turning to AI to help make my designs a reality. The speed at which it can refine my creations has been very helpful.”
Louise McCoy, Managing Director, Start Up Loans Products, British Business Bank said: “AI has the potential to transform the way smaller businesses operate, but people running those businesses face a plethora of barriers which need to be overcome if they are to benefit from the technology. We hope our information, as well as start-up financing, one of the biggest hurdles identified, can help drive more use of AI.
By adopting AI responsibly, smaller businesses could unlock new opportunities for growth and innovation, ensuring they remain the driving force of the UK economy”.
Start Up Loans offers pre- and post-loan support packages, including access to Learn with Start Up Loans, a partnership with the Open University, with courses covering key aspects of running a business.
The Start Up Loans programme was established in 2012 to help people – wherever they are in the UK and whatever their background – to achieve their ambitions of starting their own business. It provides fixed-interest loans of between £500 and £25,000 to aspiring business owners, many of whom might otherwise struggle to secure finance.
