Poor Professional Consultation Has Cost Small Businesses £6.4 Billion

New research by Direct Line for Business has revealed that 320,000 companies have been ill-advised, and as a result have lost money. Around 16% of small and micro businesses in the UK have lost an average of £20,842 over the last 12 months. One fifth of those effected believe that poor guidance cost them from £50,000 to £100,000 within the same period. If trusting in third parties wasn't hard enough, small businesses will be even less inclined to seek professional assistance following this research. 

Poor professional advice has not only lost small businesses money, it has put some in a vulnerable position. Around 46% of which felt forced to lay off staff, 39% delayed their plans for business expansion, and 34% felt obliged to take out a loan. Some (16%) even felt that poor guidance had even cost them clients. The advisory sectors that effected businesses ranged from management advice to communications consultancy. 

Being a victim of bad advice is never easy, and when poor consultation results in financial loss, then it can become a grave affair. So here's what you can do to prevent your business from falling victim to inappropriate guidance. 

Do your research

Choose a consultant that is appropriate for your business, one that is within your budget, but has a proven record of helping small businesses. Look into their education and experience, and ask to see their portfolio. By doing research you can be confident that you are choosing the right person for the job. 

Ask yourself, do you really need consultation?

There will be times when you really will need professional guidance, but on some occasions, your business could be doing just fine without it. Assess your goals and current situation; if you're not hitting your targets and deadlines then it might be worth seeking professional advice.

Monitor and measure their practices

By recording the company's progression you will be able to determine whether or not your adviser is doing a good job. You will be able to diagnose any consultancy issues sooner, which will prevent a loss of money in the future.