Small Business barometer for cash (From Wiltshire Business Online)

Small Business barometer for cash

2:00pm Thursday 9th July 2009

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Almost a third of SME owner managers in the South West, equivalent to 126,000 businesses, would take out a personal loan to fund their business according to Close Invoice Finance, part of the FTSE 250 merchant banking group, Close Brothers Group plc. The latest Close Small Business Finance Barometer based on a survey of over 500 SME owner managers found that nearly one in ten (7%) of SME’s also admitted in desperate times they would use a credit card to fund their business.

In the 2008 Close Small Business Finance Barometer, one in ten of those surveyed from the South West said they would approach family and friends if bank funding dried up. Latest statistics reveal this has doubled with now 20% of businesses nationwide relying on those closest to them for financial support. Peter Flynn, Commercial Director at Close Invoice Finance said: “SMEs continue to feel the effects of the lack of funding available from traditional sources.

"This has forced more and more SME owner managers to pursue risky short term strategies to secure cashflow and in the process, put themselves and those closest to them, under intense pressure.

“SMEs need to consider every route available to free up capital and, at the same time, be deadly serious about tackling late payment to safeguard the long term health of their business.

"Cashflow management tools can give companies complete peace of mind and provide protection against the impact of issues such as late payment and even bad debt.” Invoice finance is an alternative route to securing funding that allows companies to raise cash quickly and easily against their sales ledger, affording businesses a greater degree of flexibility and control over their cash flow.

As more and more businesses are impacted by late payment and bad debt, Close Invoice Finance recently upgraded its award-winning invoice discounting product, IDeal™, to include bad debt protection cover. IDeal™ now offers clients all the benefits of the real-time exchange of payment, plus the extra peace of mind of that comes with knowing they are fully covered should any of their protected customers fail to meet payment terms.

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