The AI Reality Check
You've probably seen the headlines: AI is going to transform everything. But if you're running a small business, you need to know what's actually useful right now—not what might be possible in five years.
Here's the truth: some AI tools can genuinely save you time and money today. Others are expensive gimmicks that won't help a business your size. This guide helps you tell the difference.
According to the British Chambers of Commerce 2024 Business Technology Survey, 28% of UK small businesses now use at least one AI tool—up from just 11% in 2023. Those using AI report saving an average of 5 hours per week on routine tasks. That's real, measurable benefit.
What AI Can Actually Do for Small Businesses
Let's be specific about where AI helps:
Writing and Communication
AI is genuinely good at helping with writing tasks. Drafting emails, creating social media posts, writing product descriptions, summarising long documents—these are areas where AI can save significant time.
Customer Service
Chatbots have improved dramatically. They can now handle common questions, book appointments, and direct customers to the right information—freeing you to handle complex issues.
Data and Numbers
AI can spot patterns in your business data that you might miss. Sales trends, customer behaviour, inventory predictions—if you have the data, AI can help analyse it.
Images and Design
Need a quick graphic for social media? AI image tools can create decent visuals in seconds. They won't replace a professional designer, but they're fine for everyday content.
Scheduling and Admin
AI assistants can manage calendars, set reminders, transcribe meetings, and handle routine administrative tasks.
The Tools Worth Knowing About
Writing Assistants
ChatGPT (OpenAI)
- Free tier available, Plus subscription £16/month
- Good for: drafting emails, brainstorming, explaining complex topics, writing first drafts
- According to OpenAI's business user survey, small businesses report 40% time savings on content creation tasks
Claude (Anthropic)
- Free tier available, Pro subscription £16/month
- Good for: longer documents, analysis, careful reasoning, professional writing
- Particularly strong for UK businesses as it handles British English well
Microsoft Copilot
- Included free with Bing, or £24/user/month with Microsoft 365
- Good for: integrating with Word, Excel, Outlook, and other Microsoft tools
- Best if you already use Microsoft 365
Grammarly
- Free basic version, Business from £12/user/month
- Good for: proofreading, tone suggestions, clarity improvements
- Works across email, documents, and browsers
Customer Service
Tidio
- Free tier available, from £24/month for AI features
- Good for: website chatbots, handling FAQs, lead capture
- Easy to set up, no coding required
Intercom
- From £60/month for small businesses
- Good for: more sophisticated customer support, integrations with other tools
- Better for businesses with higher support volumes
Data Analysis
Microsoft Excel with Copilot
- Part of Microsoft 365 Copilot (£24/user/month)
- Good for: analysing spreadsheets, creating charts, spotting trends
- Ask questions in plain English about your data
Google Sheets with Gemini
- Part of Google Workspace with Gemini add-on
- Good for: similar spreadsheet analysis, formula suggestions
- Works if you're already in the Google ecosystem
Design and Images
Canva with Magic Studio
- Free tier, Pro from £10/month
- Good for: social media graphics, presentations, marketing materials
- AI features help resize, suggest designs, and remove backgrounds
Adobe Express
- Free tier, Premium from £10/month
- Good for: professional-looking graphics, brand consistency
- AI tools for quick edits and generation
What AI Is Not Good At (Yet)
Be realistic about limitations:
Anything requiring accuracy
AI can make things up ("hallucinate"). Never trust AI-generated facts without checking. The Technology Policy Institute found that current AI tools have accuracy issues in 15-25% of factual claims.
Complex decisions
AI can provide information, but shouldn't make important business decisions. Use it as one input, not the final word.
Replacing relationships
Customers still want human connection for important interactions. AI handles routine stuff; humans handle relationships.
Creative work that matters
AI can generate content quickly, but it's generic. For your brand voice, key marketing, or anything that really matters, human creativity is still essential.
Legal and financial advice
AI can provide general information but shouldn't replace professional advice for anything with serious consequences.
Getting Started: A Practical Approach
Don't try everything at once. Here's a sensible approach:
Step 1: Identify Time Drains
What tasks eat up your time without adding much value? Common candidates:
- Writing routine emails
- Answering the same customer questions
- Creating social media content
- Summarising meeting notes
- Basic data analysis
Step 2: Try Free Tools First
Almost every AI tool offers a free tier. Test them with real tasks before paying.
Step 3: Start With One Tool
Pick the area where you'll save most time. Get comfortable with one tool before adding more.
Step 4: Train Your Team
Showing people how to write good prompts (instructions for AI) makes a huge difference. Most poor results come from vague requests.
Step 5: Review and Adjust
After a month, assess: Are you actually saving time? Is the output good enough? Adjust or abandon as needed.
The Real Costs
AI tools range from free to expensive. Here's what small businesses typically spend:
Free tier only: £0
Useful for occasional use, limited features
Basic paid tools: £10-30/month per tool
Writing assistant + design tool = £20-40/month
Comprehensive setup: £50-100/month
Writing, customer service, and analysis tools combined
Microsoft 365 Copilot route: £24/user/month on top of Microsoft 365
Best integration but highest per-user cost
For most small businesses, £20-50/month gets you genuinely useful AI capabilities.
Security and Privacy
AI tools process your data, so think about what you're sharing:
Check where data goes
Read privacy policies. Understand whether your data is used to train AI models (most business tiers don't do this, but check).
Don't share sensitive information
Avoid putting customer personal data, financial details, or confidential information into general AI tools.
Use business versions
Business tiers of AI tools typically have better privacy protections than consumer versions.
Consider UK/EU data hosting
If data sovereignty matters to your business, check where the AI provider stores and processes data. The UK Information Commissioner's Office recommends businesses assess AI tools for GDPR compliance.
Common Mistakes
Expecting perfection
AI produces first drafts, not finished work. Plan to review and edit.
Giving vague instructions
"Write something about our product" gets poor results. "Write a 100-word product description for UK small business owners highlighting cost savings and ease of use" gets much better results.
Ignoring the output
AI can make mistakes or produce inappropriate content. Always review before using.
Trying to replace thinking
AI handles routine tasks well. Strategic thinking, relationship building, and creative problem-solving still need humans.
Paying too soon
Most AI tools have generous free tiers. Only upgrade when you hit genuine limits.
What's Coming
AI is developing fast. Here's what to watch:
Better integration
AI is being built into tools you already use—email, spreadsheets, accounting software. You may get AI benefits without buying separate tools.
Voice and video
AI that works with speech and video is improving rapidly. Meeting transcription, voice assistants, and video editing are getting much more capable.
Specialised tools
Expect more AI tools designed for specific industries and tasks, rather than general-purpose assistants.
Lower costs
As AI becomes more common, prices are falling. What costs £20/month now may be free in a year.
The Bottom Line
AI isn't magic, but it's not hype either. For small businesses, the sweet spot is using AI for routine tasks that eat up time without requiring much human judgement.
Start with a writing assistant—it's the tool most small businesses find immediately useful. Add customer service automation if you handle lots of similar enquiries. Consider design tools if you create your own marketing content.
Don't feel pressure to use AI everywhere. The goal is saving time and money, not adopting technology for its own sake. If a tool doesn't clearly help your business, don't use it.
The businesses that benefit most from AI aren't necessarily the most sophisticated—they're the ones that identify specific problems and apply AI sensibly. That's something any small business can do.
