Soldo Data Reveals CFOs Caution Cashflow And Overspending Will Challenge Economic Recovery

  • UK CFOs are forecasting that their businesses will not recover from the COVID-19 pandemic until October 2022.
  • The majority of CFOs agree that now is the time to ramp up investment to catalyse recovery – although cashflow, overspending and poor forecasts present challenges.
  • 60% of UK businesses cut their spending last financial year, with the average business reducing expenditure by 14% across the UK.
  • £153 billion reduction in business spending across UK during the 20/21 financial year.

LONDON, June 7, 2021 /PRNewswire/ — CFOs across the UK warn that cashflow and overspending are the main barriers to their organisation’s financial recovery. The research, commissioned by Soldo, a European pay and spend automation platform, found that 60% of CFOs are forecasting that their business will not recover to pre-pandemic levels until October 2022. 3% of CFOs that say their business has already recovered, while 2% forecast recovery is still over five years away.

Investment Spending Reduced in The Early Stages Of The Pandemic

60% of UK businesses cut their spending in response to the pandemic, with the average business reducing expenditure by 14% in the last financial year. Economists have modelled this data, suggesting that across the UK, business spending was reduced by £153 billion in 2020/2021.

Soldo’s research found that the average reduction in business spending in the last financial year (20/21) was as follows;

  • Small firms (up to 50 employees) – £417,553
  • Medium sized firms (51 – 500 employees) – £4,011,651
  • Corporates (501+ employees) – £17,251,279

Reductions in inventory and staffing costs (including contractors, reduction of permanent headcount and a freeze in the recruitment of new talent) were the main areas where business reduced their expenditure. Nevertheless, the majority of CFOs (60%) acknowledge that now is the time to re-start business spending to drive recovery as quickly as possible. Finance professionals acknowledge that there are numerous challenges associated with ramping up investment. The following were cited as the top 5 difficulties:

  • Cashflow issues (54%)
  • Managing overspending (51%)
  • Supplier relationships (44%)
  • Inability to forecast (37%)
  • Lack of insight around spending (26%)

Said Paraag Amin, CFO of dotdigital, said:

“The pandemic has focused businesses more than ever on continuing to grow through uncertain times, and digital transformation, including the shift to cloud, is one of the key enablers of this. Having access to real-time information, wherever you are, is of paramount importance. Add to this the scaling of processes, to drive cost efficiency, means that it is very important for CFOs/businesses to continue to reinvest, not just to survive the pandemic, but to thrive.”

Mariano Dima, President of Soldo, said:

“Business leaders are taking a deeper look at spending control and payment models, whether through the pandemic or the new norm. With spend management technology, the average UK business can save 2% of annual revenues and reinvest in market expansion.

“Many CFOs have doubled down on digital transformation and cash displacement. It is crucial to have the ability to forensically examine business spend, whether SaaS, retail or advertising.”

What do CFOs cite as the top challenges threatening recovery and growth?

Managing overspending – CFOs told us that overspending is the number one challenge when it comes to making investments. 50% of CFOs recognise that a digital approach to managing spend can solve overspending. Soldo gives business leaders the ability to set tight budgets and gives real time updates, helping to prevent overspending.

Cashflow issues – Poor visibility of cashflow and working capital acts as a drag on investment. Our research found that 63% of finance teams want better oversight of their working capital. Soldo enables finance teams to track spending against budgets in real time.

Lack of insight around business spending – The inability to analyse investment spending in real-time is a challenge for a significant number of finance leaders. Over a quarter of the CFOs Soldo spoke to said that they wanted more accurate and timely insights around spending. Founders and finance teams want to see spending in real time and see where and how money is being spent.

Soldo’s research found that an incredible amount was wasted across Europe due to ineffective spending controls:

€347 billion across Europe
€62 billion in Germany
€42 billion in France
€43 billion in UK (£37 billion)
€30 billion in Italy

Cloud Benefits – Making the shift to cloud accounting enables CFOs to manage and monitor investment spending more efficiently. Soldo’s research showed that an average sized company could  save more than £2.3m annually. In short, tech-enabled businesses are much more confident in their ability to invest for future growth.

About the research
Soldo commissioned Coleman Parkes to conduct a detailed analysis on the impact of digital transformation on the finance function in small to large organisations in the UK, France, Germany and Italy. To achieve this objective Coleman Parkes designed and executed a highly targeted and representative quantitative research study surveying 950 senior finance decision makers (400 in UK, 400 in Italy, and 75 in each of France and Germany). The respondents were either owner/managers or finance directors as of November 2020.

Market representation was key in order to calculate the micro and macro impact of poor spending controls on businesses and economies as a whole. Coleman Parkes conducted all calculations in-house.

The report is available to download here.

About Soldo
Founded in 2015 by tech veteran Carlo Gualandri, Soldo is one of Europe’s fastest growing fintech companies. In 2019, the company raised a $61 million Series B round led by Battery Ventures and Dawn Capital with the participation of Accel and other existing investors – the largest round of funding ever secured by a pay and spend automation company.  

Before Soldo, tracking and controlling spending was a dark art: businesses created workarounds for payments and stifled staff with financial admin.

Soldo enables employees and departments to make purchases – from advertising to software, travel expenses to e-commerce. Control every cost with custom budgets and track transactions in real time. Connect accounting software to automate reporting and save hours, then use insights to grow.    Soldo combines smart prepaid company cards with a comprehensive management platform. The brighter way to manage business spending. 

For more information, please visit and follow us on Twitter @Soldo.

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