UK small businesses need to improve their cash flow management skills

HSBC Commercial Bank reports that 18% of small businesses said that suppliers are billing quicker and an additional 20% said that fewer companies are paying within agreed payment terms.

The survey of 596 small and medium-sized companies, found that they rely on their savings and overdraft to fund both cash flow and purchases.

40% use savings and 24% rely on overdrafts to manage their everyday finances.

18% use their overdraft to fund big purchases, such as business vehicles and equipment.

11% use their credit card for business investment.

10% are using invoice finance to actively manage their cash flow.

9% use leasing finance to help capitalise on their assets.

At the same time, the Federation of Small Businesses reports that large companies are delaying invoice payments to smaller firms.

So cash flow is tight for small businesses at this time. We are assisting by providing the 1.6 million businesses listed in our UK Business Directory, with prospects, with no cost for the business.