Late invoices are the primary culprit for causing cash flow problems for businesses according to two-fifths (41%) of UK small- and medium-sized enterprises (SMEs) while making sure the bills are paid was an issue for a third (32%) and having access to emergency cash (21%) was also top of the list. That’s according to Allstar, one of the UK’s leading business, EV and fuel expense payment companies, which launched its latest insights into the issues plaguing the nations small businesses.
Late payments are costing small businesses £22,000 a year on average, with the government announcing the New Fair Payment Code. This will include new measures and a consultation to combat the issue, which leads to 50,000 business closures a year.
The research, which surveyed 500 SME business owners and decision-makers, completed with Censuswide, found that over half (54%) cite cash flow an issue and up to 70% say that the burden of cashflow and admin has significantly hampered business growth.
Cash flows are being impacted predominantly by inefficiencies, and just over half say they spend up to six hours managing costs and their cashflow. Burdened with a daily onslaught of challenges including cash flow management, SME owners are on the lookout for little wins that make their lives easier by removing points of friction and simplification. More than a quarter (28%) said that faster payment of invoices is the key to helping their business save time, and 27% say it would solve admin and cash flow problems.