Small businesses economic improvements overshadowed by late payment

Citation

(2010), "Small businesses economic improvements overshadowed by late payment", Structural Survey, Vol. 28 No. 4. https://doi.org/10.1108/ss.2010.11028dab.006

Small businesses economic improvements overshadowed by late payment

Article Type: Newsbriefs From: Structural Survey, Volume 28, Issue 4

Improvements in orders and turnover experienced by small firms are being overshadowed by cash flow difficulties as a result of late payment, the latest economy watch member panel survey from the Forum of Private Business (FPB) suggests. Cash flow problems caused by increasing late payments are overshadowing improvements in orders and turnover. The FPB has called on more large companies to sign up to the government’s prompt payment code. A quarter (24 per cent) of entrepreneurs surveyed do not anticipate investing in their businesses in the coming months. According to the monthly survey of members on the Forum’s Economy Watch panel, 43 per cent of respondents said they had experienced an increase in orders, with 18 per cent reporting a decrease and 39 per cent no change. In all, 35 per cent said their turnover has increased from February, 24 per cent that it has fallen and 40 per cent that it stayed the same. Respondents’ total turnover is up by a reported £508,000 in March compared to the previous month. However, the total amount of capital tied up in late payment at any one time is £16,608,500, an increase of £1,014,780 from February. This equates to 35.5 per cent of their combined turnover.