PROTECTING SMALL BUSINESS, PROMOTING ENTREPRENEURSHIP

Mobile Technologies Add Billions in Time and Dollar Savings for Entrepreneurs

By at 22 May, 2014, 7:33 am

by Raymond J. Keating-

Advancements and investments in mobile technologies have created significant benefits for small businesses. Some of those benefits include time savings, which were reported were reported in a new survey conducted by AT&T and the Small Business & Entrepreneurship Council (SBE Council) released on May 14.

Consider the following survey data on usage and time saved by small businesses when it comes to tablets, smartphones and mobile apps, and estimates regarding significant annual hours and dollars saved.

Tablet Use: 

The survey showed that 61.7 percent of small businesses use tablets, with weekly hours saved for small business owners averaging 4.79 hours per week. According to U.S. Census Bureau, there were 5,104,014 employer firms with less than 20 workers in 2011 (latest data). Based on survey results, there would be 3,149,177 small businesses using tablets. In turn, the use of tablets saves small businesses 754.2 million owner hours annually.

Small businesses are savings billions in time and money using mobile technologies, but billions more could be saved if they were more widely adopted by entrepreneurs.

Small businesses are savings billions in hours and dollars using mobile technologies, but billions more could be saved if these tools were more widely adopted by entrepreneurs.

What does that translate into in terms of estimated dollar savings? Well, based on the Fall 2013 American Express OPEN Small Business Monitor, small business owners work an average of 10.5 hours per day, and earn an average annual salary $68,300. Assuming 50 workweeks, the per hour pay for small business owners would be $26.02. Therefore, the estimated dollar value of small business owners’ time saved due to use of tablets is $19.6 billion annually. 

If all small businesses were to use tablets, small businesses could save 1.22 billion owner hours annually, translating into an estimated dollar value of $31.8 billion annually in savings. 

These are significant amounts, but also quite conservative as they only cover firms with employees, excluding the self-employed without any employees.

What about time and dollars saved thanks to the use of tablets among employees at small firms? Of the small firms using tablets, the average hours saved per week for small business employees was 3.945 hours. That translates into 621.18 million employee hours saved annually. 

As for dollars saved, based on the Intuit Small Business Employment Index March 2014, employee hours worked averaged 108.8 in March, with compensation at $2,747, which translates into an hourly pay rate of $25.25 for businesses with less than 20 workers. That then points to an estimated dollar value of annual employee hours saved being $15.7 billion. 

If all small businesses were to use tablets, small businesses could save 1.01 billion employee hours annually, translating into an estimated dollar value of $25.4 billion annually in savings. 

In the end, the use of tablets, based on these survey results and accompanying estimates, saves small businesses 1.4 billion hours in employer and employee hours annually, with the estimated dollar savings coming in at $35.3 billion. If all small businesses were to use tablets, those hours saved could climb to 2.23 billion annually, translating into dollar savings of $57.2 billion.

Smartphone Use:

The survey showed that 94.3 percent of small businesses use smartphones, with weekly hours saved for small business owners averaging 5.16 hours per week. There would be 4,813,085 small businesses using smartphones. Therefore, the use of smartphones saves small businesses 1.24 billion owner hours annually.

What does that translate into in terms of estimated dollar savings? The estimated dollar value of small business owners’ time saved due to use of smartphones is $32.3 billion annually.

If all small businesses were to use smartphones, small businesses could save 1.32 billion owner hours annually, translating into an estimated dollar value of $34.3 billion annually in savings.

Again, these are significant amounts, but also quite conservative as they only cover firms with employees, excluding the self-employed without any employees.

What about time and dollars saved thanks to the use of smartphones among employees at small firms? Of the small firms using smartphones, the average hours saved per week for small business employees was 4.625 hours. That translates into 1.113 billion employee hours saved annually.

Estimated dollar value of annual employee hours saved:  $28.1 billion.

If all small businesses were to use smartphones, small businesses could save 1.18 billion employee hours annually, translating into an estimated dollar value of $29.8 billion annually in savings.

In summary, the use of smartphones, based on these survey results and accompanying estimates, saves small businesses 2.35 billion hours annually in employer and employee hours, with the estimated dollar savings coming in at $60.4 billion. If all small businesses were to use smartphones, those hours saved could climb to 2.5 billion annually, translating into dollar savings of $64.1 billion. 

Mobile App Use: 

The survey showed that 51.5 percent of small businesses use mobile apps, with weekly hours saved for small business owners averaging 5.007 hours per week. There would be 2,628,567 small businesses using mobile apps. Of that, since 91.1 percent said that the company’s use of mobile apps saved owner time, we have an estimated 2,394,625 universe of small businesses saving owner time with mobile apps. Therefore, the use of mobile apps saves small businesses 599.5 million owner hours annually. 

What does that translate into in terms of estimated dollar savings? The estimated dollar value of small business owners’ time saved due to use of mobile apps is $15.6 billion annually.

If all small businesses were to use mobile apps, small businesses could save 1.16 billion owner hours annually, translating into an estimated dollar value of $30.3 billion annually in savings.

Once more, these are significant amounts, but also quite conservative as they only cover firms with employees, excluding the self-employed without any employees.

What about time and dollars saved thanks to the use of mobile apps among employees at small firms? Of the small firms using smartphones, the average hours saved per week for small business employees was 5.072 hours. There would be 2,628,567 small businesses using mobile apps. Of that, since 75 percent said that the company’s use of mobile apps saved employees time, we have an estimated 1,971,425 universe of small businesses saving employee time with mobile apps. That translates into 499.95 million employee hours saved annually.

Estimated dollar value of annual employee hours saved:  $12.6 billion.

If all small businesses were to use mobile apps, small businesses could save 970.8 million employee hours annually, translating into an estimated dollar value of $24.5 billion annually in savings.

In summary, the use of mobile apps, based on these survey results and accompanying estimates, saves small businesses 1.01 billion hours in employer and employee hours, with the estimated dollar savings coming in at $28.2 billion. If all small businesses were to use mobile apps, those hours saved could climb to 2.13 billion annually, translating into dollar savings of $54.8 billion.

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Raymond J. Keating is chief economist for the Small Business & Entrepreneurship Council.

Keating’s new book, published by SBE Council, is titled Unleashing Small Business Through IP: Protecting Intellectual Property, Driving Entrepreneurship. It’s available from Amazon.com here.

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