LONDON: Poor professional advice from third parties or consultants has resulted in 320,000 enterprises losing money. Estimated average loss of £20,842 to Britain’s small and micro businesses because of poor advisers and consultants. The greatest issue has been caused by deficient IT consultancy advice.
Poor professional advice from third parties or consultants has resulted in one in six (16 percent) small and micro businesses (the equivalent of around 320,000 enterprises1) losing money, according to new research2 published by Direct Line for Business.
Professional advisers, such as accountants and property consultants, are warned that they could be pursued for losses incurred as a result of giving substandard advice. The research reveals that advisory consultants and other such firms have cost Britain’s small and micro businesses an estimated average of £20,842 in the past 12 months due to inadequate professional consultancy, with one in five (19 percent) claiming to have lost between £50,000 and £100,000. In total this would equate to a whopping £6.4 billion lost by small and micro businesses as a result of poor advice in the past 12 months.3
IT consultants were identified as the professionals most likely to give damaging advice. Four in ten (44 percent) businesses whose operations were affected by bad advice blamed their IT consultants. A third (34 percent) of businesses suggested it was poor advice on management issues, while 32 percent claimed incompetent marketing consultancy negatively impacted their business.
