Most small companies go bust before they reach the two-year mark (no matter how good their business idea is). Costs are almost always the cause of this demise and the reason for this is that it’s incredibly difficult for businesses to manage their finances at the startup stage.[continue reading…]
Despite more shops opening as the lockdown is being eased there are still many businesses that will remain closed or at best will be operating at reduced capacity for a while yet. A large number of employees will stay on furlough until autumn. All this means that ‘business as usual’ is a long way off. Unless your business happens to be one of those fortunate ones that have been doing well since the lockdown started, you may be seriously concerned about survival.[continue reading…]
Readers question: If I have three separate Limited company businesses, can I pay myself a salary/management fee from each one or only the one?[continue reading…]
Making sure your business is safe and secure is vital for all business owners. Having good security systems is essential but it can also be costly. It is now possible to rent a complete, permanent security system designed for your specific needs, without having to buy a system and then replace them when they get outdated. In this guide, we cover how you can get the latest security system without buying any equipment for your small business.[continue reading…]
Every summer, millions of us will put down our tools and find somewhere sunny for a well-earned break, but for small businesses, the summer holidays can cause a whole lot of stress. Staff are away, business is slow and revenue slows down. By the time everything is back up to speed, they often find themselves running short of cash.
There are basically two ’schools of thought’ when it comes to analysing financial data and making assessments about the general performances of a business or a company. The first is the one which tells you that analysing financial data is not as big of a deal and that you can easily judge a financial situation by doing some basic calculations and looking at the certain numbers. The second is the one which advocates that a more thorough and meticulous approach needs to be conducted in order for these numbers to actually mean something.
Having good cash flow is fundamentally essential for any business wanting to run smoothly and successfully. A recent UK study found that, on average, SMEs spend more than £1m a year on business-related expenditure such as staffing costs, rent, office equipment and supplies. This highlights how vital it is for SMEs to have a solid grasp of their incomings and outgoings so they can plan ahead and meet these costs.
Many business owners struggle to explain their accounts and numbers (we’ve all seen this on Dragon’s Den). However, unless you understand the story your numbers are telling you, you are likely to be running your business on luck alone.
We are still not sure what kind of Brexit we will get. Even assuming a ‘good’ Brexit, will we be thrown into another recession? Will history repeat itself and, if so, what will this mean for start-ups, SMEs, and investors?
A recent Government report shows that £44.6 billion is owed to small-to-medium sized businesses in late invoice payments. While it’s hard to fathom how much impact this amount of money will have on the economy in general, it’s important to understand the impact it can cause business owners.
Good invoicing is vital for freelancers and anyone running a micro/small business. Sending out well-designed, concise invoices is important to get you paid. It will make it easy for your clients to pay you, that way you’re much more likely to get paid on time. The last thing you want to do is spend all of your time chasing unpaid invoices.
Running and maintaining a successful business is incredibly hard work. It doesn’t matter how big or successful you are, a start-up, a big hitter or even if you are dominating the marketplace, things can go wrong at any time. The business plan just might not be right for the market or an unexpected cost could set back your cash flow.
Cash flow is the term for the money that flows in and out of your business. From petty cash to business capital, cash is what keeps small businesses alive. While it is usually measured monthly, quarterly or annually, your cash flow should always be at the forefront of your mind.
Failing in business at some point is not only inevitable but essential. Failure is the biggest teacher, therefore there is always a lesson to be learnt. Failing at anything can be horrible and it can definitely knock your confidence, however, it’s vital that you get back up. As the small business owner and decision maker, you are allowed to fail, however, it’s your recovery that says everything about you as a leader. You need to make sure that you are leading by example and showing your team how to recover from a failure in business.
This advice is based very much on experience. Only two years ago, I was about to close my digital agency. I had been forced to let six staff go and it was down to just me and one other.
According to a recent survey, 49% of all nurseries in England do not make profits. This may come as a surprise to many parents who believe childcare costs are too high. Not only this, but a recent article by the National Day Nursery Association (NDNA) also stated that nurseries are now closing ahead of 30 hours due to low funding and wider business pressures.
Whether you are a start-up or an established business, efficient money management should be a core value. That means planning, organising, controlling and monitoring all financial resources, all of the time. The business world changes hour by hour, what was working well last week isn’t necessarily doing so this week. Effective management of company money means you are making the best use of your resources, it will make and keep your company competitive, ensure that your stakeholders get optimum rewards and lay a solid foundation for future stability.
Keeping on top of your finances is one of the biggest causes of stress for small business owners, as the financial position of a business can really be the make or break point for the future of it. There are many challenges that small business owners face, from building a customer base to being a supervisor or creating and delivering good quality products. As a business owner, you will need to wear multiple hats in order to keep the business running. However, managing your finances may be of particular importance to the livelihood of your small business.
If you’ve already followed the standard procedures for recovering an unpaid invoice, you may be considering more drastic actions. Unpaid invoices are a common problem for SMEs and can cause significant financial burdens. Once 38 days have passed since the invoice due date, you have four options for debt recovery given by Sage.
It’s no secret that half of the start-ups started in the UK fail within the first five years of operating. Small businesses should consider surpassing the five year mark as a real accomplishment, as that is the point they are out of the danger zone. So, what are the reasons behind the failure of these start-ups?