"It's no surprise that half of UK small businesses are looking for more support with their finances."
51% of UK SMEs say they need more help to take control of their finances – equating to 2.86 million small businesses, according to research by Funding Options.
The results also reveal that 33% of small business owners have previously found themselves in financial difficulty with a similar proportion (32%) saying they have lost sleep worrying about their business finances.
The first quarter of 2019 saw company insolvencies reach their highest levels in five years. Yet nearly a quarter (23%) have no idea that they’re going to go into the red until it happens, increasing to nearly half (46%) of business owners aged under 35. Only 53% regularly forecast their finances to help them keep track of cash flow.
The research also found that just 7% of SMEs review their finances more than once a month, with nearly a quarter (23%) only doing so once a quarter. 17% of those surveyed said that they don’t have any formal reviews of their business finance at all, and this was most common among sole traders with nearly half (46%) admitting this to be the case.
Three in ten (28%) small businesses have struggled to access funding from mainstream lenders, with one in five (21%) even having to approach their family and friends for money after being turned down by the banks.
Ryan Edwards-Pritchard, managing director of Funding Options, said: “The primary focus of any small business should be on its product and customers and so it’s easy for financial operations to take a back seat. Along with day-to-day challenges, additional factors such as the huge uncertainty around the outcomes of Brexit only add more pressure. It’s really alarming how many small businesses have gone into administration in 2019 already and it’s no surprise that half of UK small businesses are looking for more support with their finances.
“New tools entering the market are giving entrepreneurs the power to take full charge of their finances, simplifying everything from tax returns to cash flow projections and if utilised we will hopefully see more organisations survive and thrive – putting an end to sleepless nights.”