SMEs concerned about cash flow
A new study suggests that many small businesses are concerned about their cash flow.
In a survey carried out by Barclaycard, 69 per cent of small and medium-sized enterprises (SMEs) said that cash flow was a ‘key worry’ for their business, while a similar number added that insufficient working capital was having a negative effect on their growth plans.
More than a third (38 per cent) of SME bosses and decision-makers said that they thought their cash flow worries would get worse going into the New Year.
A further 32 per cent added that late payments were the key reason they were experiencing cash flow problems.
This sentiment echoes separate data published earlier this year by the Government, which revealed that approximately a third of all payments to UK SMEs are late, and that around 20 per cent of small firms are struggling with their cash flow as a result.
In recent days, the Government has appointed a Small Business Commissioner, Paul Uppal, whose role will be to support the UK’s 5.7 million SMEs with disputes relating to poor payment practices.
The move comes after official research estimated that the UK economy could be boosted by £2.5 billion annually if UK SMEs were paid on time.
Mike Cherry, Chairman of the Federation of Small Businesses (FSB) said that Mr Uppal’s appointment was “crucial to turning the tide on this late payments culture” and tackling “the worst examples of supply chain bullying.”
He added: “Success will be a UK economic culture where a business that does a job promptly, is paid promptly.”