Rising costs, economic uncertainty and caution among customers is putting small business owners under huge pressure. But many believe artificial intelligence (AI) could be part of the solution.

New research from Novuna Business Finance has found that nearly one in three small business owners (31%) currently use AI to support their operations.

Of course, the adoption of AI varies across the country, with businesses in London among the most likely to use the technology.

And certain sectors are using AI more than others, with companies in sectors such as IT, finance and legal services leading the way.

But interestingly, Novuna believes there’s a link between embracing AI and business growth.

Could AI kickstart small business growth?

AI adoption was found to be more widespread among small businesses that are significantly growing this quarter (59%) than it is among those firms that are shrinking (23%).

That’s significant when you remember that many small business owners are worried about the future.

Just 24% of small businesses surveyed predict growth between July and September - the lowest figure on record.

So could AI be the key that unlocks growth for struggling small businesses?

Well, potentially, but there are two big obstacles.

Small businesses don’t know where to start

Firstly, many small business owners don’t know how AI could be deployed.

In fact, nearly a third (29%) admitted they were unsure how AI could be used within their business.

And that knowledge gap alone could be one of the biggest barriers to adoption and impeding their growth.

Firms worried about losing the human touch

Secondly, small businesses owners often have close relationships with their customers and their communities.

And Novuna believes some are wary about AI as they feel it could put those connections at risk.

As head of insight Jo Morris says: “Many survey respondents expressed caution towards AI, precisely because their enterprises were built on enduring human relationships and personal service.”

However, she said the two can live alongside each other.

“In truth, humans and AI need to co-exist,” Ms Morris commented.

“And in the early days of AI roll-out, striking the right balance is key.”

How are small businesses using AI?

 For small businesses that have already adopted AI, many are already feeling the benefits, such as:

• making back-office or operational processes more efficient - 16%
• improving their online and digital marketing capabilities - 15%
• assisting with market research and product development - 14%

 These aren't necessarily complicated or futuristic applications.

They are everyday business challenges where technology can potentially give a small team an extra helping hand.

For example, AI could help a business draft marketing content, analyse customer feedback, summarise information, identify market trends or reduce the amount of time spent on routine admin.

And if you’re wary but open-minded about AI, then start small.

You don’t have to turn your whole business over to it in one go.

Just identify one repetitive task that takes up valuable time and see if AI could help with it.

Turning over just one job to AI could free up precious time.

And that, in turn, gives you more of a chance to concentrate on the work that matters most, and deliver the best possible service to your customers.