Small businesses unveil financial fears as election looms

Cash flow problems are currently having a negative impact on 43% of the UK’s small businesses, new research from has suggested.


The energy compare service added that 93% of small business owners believe that drastic changes are required to the way they carry out business.


It places great importance on the upcoming general election and for the government to ensure that good conditions for business are in place.


Some 35% even suggested that they might have to shut down entirely should the situation not improve significantly in the months ahead.


Based on their current bank balances, 24% of those questioned were unsure whether they would survive and continue trading for beyond six months.


Issues for small businesses extend beyond finances though, as one in ten business owners said they had lost a friend as a result of working too much.


A further 38% said they had arguments with their partners due to stress while 42% of those questioned said there were occasions when they even forgot to eat due to high work levels.


From a financial perspective, SME owners added that late payments were an issue in 31% of cases as it impacted negatively upon the cash flow.


Seeking advice from insolvency practitioners is recommended if losses continue as some measures could be put in place to alter the situation.


Other costs relating to energy and insurance were also viewed as an issue by those questioned, by 25% and 21% respectively.


Some business owners even hinted that stress was causing their business to underperform while 14% said business rates and costs should be reduced to aid struggling firms.


Higher tax free allowances, harsher penalties for late payments and an increase in small business funding were among the changes that SMEs were would like to see following May’s election.


Small businesses have been described as the lifeblood of the UK economy, but the latest figures suggest more support may be needed to encourage their success.


By Phil Smith


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