Over half of UK small and medium-sized enterprises SMEs (55%) are concerned about business cash flow, according to an independent survey commissioned on behalf of Royal Bank of Scotland (RBS) and NatWest. A further 25% rely solely on Excel spreadsheets, with only 14% of SMEs using professional cash flow tools
Yet despite these concerns, 41% of those surveyed had never run a cash flow forecast, even though poor cash flow management meant that a fifth of SME’s, with 26 employees or more, had been unable to pay staff on time. Research also showed cash flow was stunting SME growth, with one in four businesses admitting they had been forced to turn down a high volume order because of concerns around capital.
Small to medium-sized businesses, with 26 to 100 employees, were worst impacted, with 41% stating that they had been unable to scale-up their businesses, invest in new technology or larger premises, due to cash flow problems.
When it came to financial support and advice, around a quarter of SMEs surveyed felt like there was nobody they could ask for advice and 78% felt that the UK government was not doing enough to provide SMEs with access to capital.
The survey is being released to coincide with the launch by RBS and NatWest of a free working capital management tool for businesses, entitled
‘Working Capital Optimiser’
The new open-to-all tool is available online from 1 July. It includes features such as the ability for businesses to understand their current working position, identify improvements and scenario plan for future activities within their business, enabling them to focus their capital on the areas that will drive the maximum benefit for their business.
Cash-flow based metrics now feature prominently alongside traditional revenue measures of business performance in the key figures or financial summary pages of any public company.
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