Procurement ยท 11 December 2017

Rural businesses embrace digital economy but suffer from skills and training gap

rural business
Cloud technology?is the biggest digital driver of growth for rural firms

A lack of digital skills and access to training is preventing business owners in rural parts of Britain from fully embracing the digital economy, a new study has found.

As many as four in five rural business owners view digital tools and services as crucial to the future growth of their ventures. However, a lack of skills and training in remote areas means these owners still face barriers when it comes to digital ?adoption?.

The study, by the think tank Rural England and Scotland?s Rural College (SRUC), and commissioned by Amazon, asked over 800 rural business owners what their most important digital tools and services were.

Cloud computing software was seen as the biggest driver of growth for rural businesses, with 62 per cent of owners claiming it was vital to their firm. This was followed closely by 5G mobile networks (54 per cent), the Internet of Things (47 per cent) and the growth of artificial intelligence (26 per cent).

Three rural entrepreneurs proving a business can thrive in the countryside

One company that emphasised the growing importance of cloud computing to rural businesses was IceRobotics, which provides data collection and analysis tools for monitoring dairy cow behaviour to the farming industry.

The firm uses cloud computing and sensor technology to measure the fertility and general health of dairy cows, providing farmers with alerts and visualisations of how livestock are moving in order to better manage their herds.

Revealing how important the technology had become for his business, IceRobotics CEO, Douglas Armstrong, said: ?Cloud computing?provides compute power, storage, analytics, content delivery and other functionality to help farmers move faster, lower IT costs, and scale globally in minutes, so it?s key to driving innovation.

?The growth potential cloud computing brings to the agricultural sector is significant, so the faster we get rural businesses adopting new technology, the more globally competitive rural Britain will be.?

The research also showed how important ecommerce had become to rural businesses, particularly those that export. Some 80 per cent of business owners polled used digital tools to trade goods and services internationally.

In terms of the sectors in which ecommerce was used most widely by rural businesses, retail and accommodation/ food came out on top, with 80 per cent and 71 per cent of rural businesses in those industries respectively found to be selling online.

Far and away the top export destination for rural businesses was the EU, with 84 per cent of exporters trading with the European bloc. This was followed by the second biggest export destination for rural businesses ? the US ? where 45 per cent of firms sold to.

Amazon?s UK country manager, Doug Gurr, said: ?We see digital technology?levelling the playing field between businesses operating in urban and rural parts of the country, whether that?s exporting locally produced goods or using cloud computing to scale their business.

?The research finds that rural businesses are typically family-run, home-based, owned by people aged over 55-years old and employing fewer than ten people ? exactly the type of businesses that can gain from using digital technology to expand their productivity.?

Despite issues to do with internet reliability and speed, the research revealed rural businesses faced a growing variety of skills-related barriers to digital adoption, with some 52 per cent of owners claiming that some form of skills-related obstacle was limiting growth.

Nearly a third of rural businesses had difficulty finding connectivity support, whereas 14 per cent had difficulty accessing the correct digital training for staff. Meanwhile, a fifth or rural businesses admitted that they weren?t able to recruit people with people with enough digital training.

Commenting on the findings, chair of directors at Rural England, Brian Wilson, said: ?What is striking is the ambition and willingness of rural businesses to embrace new technology that could increase the global competitiveness of our rural economy.?

?Whilst connectivity remains a concern, it is clear that more needs to be done beyond this in terms of more proactive support and skills development. We need a clear roadmap for fulfilling that potential ? something we hope the final report will identify when published.?

Business broadband: The options out there and how to improve connectivity in rural locations

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Fred Heritage was previously deputy editor at Business Advice. He has a BA in politics and international relations from the University of Kent and an MA in international conflict from Kings College London.

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