Small firms list retaining clients as most pressing concern
Retaining clients is the primary concern for the UK’s small business owners, ahead of cash flow and late payment issues, according to new research.
Nearly two thirds of 1,000 small firms cited keeping clients as the biggest cause of stress in a Solution Loans survey.
That was more than the 58% who said that remaining profitable was their biggest concern, and above the 52% who listed cash flow as a major issue.
Around 48% of those questioned also voiced anxiety over how they attract new business, another important factor in ensuring the longevity of a start-up.
While worries over profitability and cash flow are likely across most businesses, online retailers reported additional concerns.
One worry related to the power noted by the major online marketplaces and their ability to cease trade deals at any time.
The small businesses questioned reported that even a temporary break in trading could significantly impact on their cash flow, and could force a business into debt depending on its operating margins.
Changes to listings and fees in marketplaces can also cause problems for small firms, as it can see rivals gain a competitive advantage.
It’s important for retailers to watch their competition in order to take appropriate action if new products or offerings come to market.
Online firms also need to ensure their cyber security measures are up to scratch, as reputational damage and potential fines could further financial issues should they be targeted.
Firms facing financial difficulties should seek advice from a corporate insolvency practitioner at the earliest opportunity in order to assess the options available.
Refinancing via alternative finance options can help to alleviate cash flow pressures while turnaround management can help to restore company performance.
The key is to act early, as this provides recovery specialists with the best likelihood of finding a suitable solution.
By Phil Smith