A recent study of more than 1,000 small business leaders reveals that financial management is keeping them up at night. One fifth (20 per cent) admit they struggle to keep on top of the business’s finances, highlighting a cause for concern in the country’s SME sector.
In fact, the concerns aren’t only expressed by younger businesses. While a third (30 per cent) of those in the first year of trading agree that it is one of their biggest worries, surprisingly, a similar proportion (29 per cent) of those with a turnover of more than £10 million have the same worry.
With the fiscal year coming to end, the research highlights the need for more financial education and support for the UK’s small businesses. One in ten of those surveyed agree that there is not enough financial planning and advice available for small businesses and startups. Given the option, money being no object, the same proportion would outsource their day-to-day financial management.
Software developer, Reckon, who commissioned the study, urges the government to put this on the agenda for the Small Business Commissioner, when appointed.
Mark Woolley, commercial director at the firm, says, ‘It is worrying that so many businesses are concerned about financial management, as it is an issue that can impact their suppliers, partners and our economy. With the potential threat of increased business rates and late payments, SMEs need as much support as possible to understand how to keep on top of changes and keep business moving.
‘Financial management is one of the keys to success for any business, regardless of size, affecting all areas of the company. History has shown that companies with high sales revenue but poor financial management can still fail.’
Woolley concludes, ‘Whilst there are some resources out there already, there is clearly still a gap to be filled and it needs to be filled quickly. We’d urge any new business to seek good advice on the easiest and quickest ways to take control and stay on top of day-to-day finances.’