Rising energy bills and late payments putting small businesses at risk
Small and medium sized enterprises are facing an uphill battle against rising costs and late payments, the Forum of Private Business (FPB) claims.
According to its quarterly Referendum survey, 85 per cent of FPB members reported an increase in energy costs, which is concerning as this comes ahead of the latest raft of price hikes from the UK's largest energy firms.
As a result, SMEs could be facing another 'winter of discontent' if the weather also takes a turn for the worse, says the FPB. Commenting, Alex Jackman the Forum's Senior Policy Adviser said: "It could be that we are shaping up for another winter of discontent, particularly if the mercury plunges this winter and firms are hit with huge heating bills and a fall in trade like we saw three years ago. Many firms are already battling the economic elements, but if the weather turns it could spell the end for those already walking a cost tightrope."
Late payments by customers are further exacerbating these problems the survey found, as 59 per cent of respondents are having to cope with tardy payment, while changing payment terms have caused problems for 24 per cent of businesses.
"While we understand that the Government is limited in what it can do to ease the situation, particularly with state spending only getting tighter as the austerity drive bites, it is not entirely helpless. We suggest it launches a call for evidence on the use of mandatory e-invoicing for all prime contractors to the public sector," Mr Jackman added.
Other hurdles facing businesses include wage inflation, tight credit conditions and cashflow problems.
We can help your business to manage and grow during these tough trading conditions, contact us to find out how.