By Max Clarke
The UK’s business recovery is being impeded as late payments from suppliers stem cashflow to smaller businesses.
As the Bank of England forecasts continued economic uncertainty, cashflow worries will continue to remain a major headache for the nation's businesses.
Business software provider, Sage have today published the results of their monthly Omnibus business survey of over 1,000 small enterprises: the results revealed that more than a third of small business owners say late payments have become a more serious problem in 2011, with a similar proportion saying their cashflow situation has worsened over the past six months. The findings echo the results of the Sage Business Index Report issued earlier this year, which found almost half of UK small businesses view managing cashflow as one of their top concerns for 2011.
“As the uncertain economic conditions continue,” said Michael Barber, Sage One’s Marketing Manager, “small businesses are under increasing pressure to ensure good cashflow management. The ability to run aged debtor and creditors reports, as well as nominal activity and trial balance reports, will give Sage One accountants and their clients a detailed view of financial performance in real time.”
A recent report by Bacs claimed Britain’s small businesses are owed in excess of £24bn in outstanding debt, with entrepreneurs waiting an average of 39.2 days beyond their agreed terms for payment. According to Sage’s research, 35% of SMEs believe large businesses are the worst culprits when it comes to delaying payment, however only 10% of SMEs said they would charge interest on outstanding debts if a firm failed to pay them on time.
The findings from Sage’s Omnibus come as the company announces the first in a series of enhancements to Sage One, the industry’s newest family of software as a service tools designed to offer small business owners a simple, secure, low cost way to manage their finances and collaborate with their accountants in real-time. The enhancements, which include the ability to run aged debtors, as well as nominal activity and trial balance reports, help small business owners and their accountants more effectively manage cashflow by making it easy to obtain a clear, accurate picture of the firm’s current financial status.
“Late payments,” concluded Barber, “are a fact of life for many small business owners, but good management can ensure they do not have a damaging effect on the business’s overall cashflow. The new functionality within Sage One, notably the ability to run aged debtors and creditors reports, gives business owners and their accountants a clearer view of financial performance at any one time, which will help them prioritise and chase late payments before they become a major issue.”
For further information on Sage One, or to sign up to a free 30 day trial, please visit: www.sageone.com
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