“Concerns Around Cashflow And Late Payment Are On The Up” – Forum of Private Business
Concerns around cashflow and late payment are on the up, from 33% last year to 38%, according to new research conducted by the Forum of Private Business. The Forum also concluded that concern around access to finance also increased, from 17% to 23% this year, and the actual cost of finance, from 6% to 8%. "As a financial concern the rising cost of doing business has abated slightly, which perhaps ties in with inflation having fallen recently, but it's clearly still a real and present issue for small firms," said the Forum's Chief Executive, Phil Orford. "Overall though these results are more alarming simply by the picture of deterioration they paint with regards to SME finances. There's little doubt that this is being driven by the banks ongoing failure to deliver affordable finance to small firms, and it seems the banks are also now making even greater demands on SMEs to secure loans. "The data also suggests there is a growing feeling of unease around cash flow and late payment among business owners, and there's certainly an argument that this is also being driven by the banks' lending dip. It stands to reason if finance is difficult to come by, cash flow becomes harder to manage, and the effect of this can be felt right through the supply chain. Our research shows 38% of businesses still reporting late payment as a problem despite the government's recent efforts to address this bad practice." As part of the same research the Forum asked members whether there was a need for better credit control guidance to help SMEs better manage their finances. 39% felt that it was a good idea.
More details can be found at: www.fpb.org