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Tag: Close Invoice Finance

North Somerset firms under pressure from soaring costs

Rob Harris

Rob Harris of Close Invoice Finance

Businesses in North Somerset continue to suffer as a result of record fuel prices, in spite of the government’s decision to postpone a rise in fuel duty originally planned for the beginning of the New Year.

The increased cost of fuel is just one of a number of issues impacting firms in North Somerset with companies up and down the region are struggling to cope under the strain of the current economic landscape which has forced businesses and consumers alike to rein in spending.

Rob Harris, local head of Close Invoice Finance, commented on the problems facing firms: “From talking to our clients in all sectors, the general consensus is that rising fuel costs remain one of their main concerns on a daily basis. This is having a huge impact on operating costs for firms of all sizes, with SMEs in particular being hardest hit.

“Bearing in mind that firms are already suffering, having been hit hard by the economic misery of recent years, coupled with consumer confidence being at an all time low, it is not hard to see how increased fuel costs are causing firms a lot of additional pressure, which is ultimately pushing some beyond their limits.”

Unfortunately, many North Somerset businesses are being forced to pass some of these costs onto the people they rely on the most – the customer.

“The fact that these increased costs are having to be passed onto customers does nothing to help companies, who are already struggling to survive, attract new business or hold on to current customers. When increased operating costs are passed down to customers the knock on effect on sales can be huge,” concludes Mr Harris.

To find out more about Close Invoice Finance visit: http://www.closeinvoice.co.uk/home/index.html

Business owners’s personal lives take a dip in South West

Rob Harris

Rob Harris of Close Invoice Finance

A staggering 52 per cent of SME owner managers in the South West say that the state of the economy is taking its toll on their personal life, according to new statistics released today.

The latest Close Business Barometer shows that of those who say their personal life is suffering, 54 per cent are stressed and over a third say that their work-life balance has deteriorated. The survey canvasses the views of SME owners across the UK on a range of financial issues.

Rob Harris, local head of Close Invoice Finance said; “A huge 94 per cent of business owners in the South West said they believe this recession still shows no sign of abating, and over a quarter said that their trading conditions have worsened over the last 12 months.

“When asked about their main concerns for the coming year, 26 per cent of respondents cited the possibility of a double dip recession, and a further fifth said they’re most worried about market volatility.

“Looking at the statistics, it’s not really surprising that all this fear and uncertainty is having a negative effect on bosses’ private lives, knocking their work-life balance off kilter and affecting their health,” he said.

Problems such as bad debt, struggling cash flow and late payments account for 18 per cent of business owners main concerns for the coming year.

“Cash flow management and the issues surrounding it needn’t be such a major cause of stress though,” said Mr Harris. “My advice is this, don’t put all your eggs in one basket when it comes to your cash flow. Forward thinking companies are now using a blend of traditional bank lending, asset-based lending and leasing to meet their funding needs.”

Asset based lending and in particular, invoice finance, is a flexible solution that has been steadily outperforming other types of business finance, including bank lending*.

“Unpaid invoices are actually a huge asset for many businesses, hence the rising popularity of invoice finance. Put simply, it means that when you raise an invoice, you will receive up to 95 per cent of the value of that invoice immediately, meaning that you don’t have to wait up to 30 days or longer for your customers to pay. Thus leaving you with the cash to fund not only your day-to-day outgoings but also your aspirations for growth.

“It also means that funding grows in line with your business; the more invoices you raise, the more funding you get.

“Being smart about this should mean that cash flow is one less thing to worry about,” he added.

South West businesses unprepared for big freeze according to survey

Rob Harris

Rob Harris of Close Invoice Finance

With predictions of another big freeze just around the corner, a worrying number of companies admit to being ill-prepared for the inevitable disruption it will bring.

The Close Business Barometer, a quarterly survey of small and medium-sized businesses across the UK, found that while more than half (52 per cent) of businesses in the South West are worried about the effects of more arctic weather this winter, 15 per cent don’t have a business continuity plan in place to deal with unfortunate, but common, consequences such as staff absenteeism and power failures.

The British Chambers of Commerce estimated that last year the economy lost £1.2bn a day due to the cold snap. Small and medium-sized businesses are most vulnerable and those that are already struggling because of the economic conditions may find that several days out of business due to extreme weather is the final straw.

Rob Harris, local head of Close Invoice Finance who independently commissioned the survey said; “All too often people think about massive disasters when they talk about business continuity but in reality it’s the more mundane factors – like bad weather – that can impact us most of all.

“If businesses aren’t prepared for the worst,” warned Mr Harris, “it can have a serious effect on cash flow which everyone knows is the lifeblood of all business. Prevention really is better than cure and I would urge SME owners who aren’t already prepared to act now, checking that premises are winter-proof, insurance is up to date and flexible working plans are in place in case staff can’t make it to work.”

For certain sectors of the economy, such as transport and logistics, there is of course no escaping the financial impact of the harsh weather, but Mr Harris explains that with careful planning any disruption can be kept to a minimum.

“Our study revealed that eight in ten businesses operating in the transport and logistics industry are worried about the effects of another big freeze, substantially higher than the 58 per cent average across all business sectors,” he said. “Transport grinding to a halt is probably the single biggest economic blow when heavy snow hits the UK. For owners of logistics and haulage companies the cost of late deliveries, extra fuel charges, and honouring strict contracts with clients can put a devastating strain on financial resources.”

He added; “The key for getting through one of the worst winters we’ve seen for years is preparation. Failing to plan could have a serious impact on your business and result in it being unable to trade.

“My advice to businesses would be to have in place suitable funding arrangements to ride out any potential cash flow problems associated with the weather. Invoice finance is one option. It enables businesses to access cash immediately, easing any financial pressure and allowing companies to get on with what they do best – running their business.”

South West businesses missing out on finance due to bank fears

Rob Harris - Close Invoice Finance

Rob Harris of Close Invoice Finance

New research has revealed that almost a quarter of businesses in the South West may be missing out on access to finance simply because of fears about approaching their bank.

23 per cent of respondents in the Business Finance Barometer, independently commissioned and published by Close Invoice Finance, stated that they hadn’t asked for increased credit from their bank for fear of either being turned down, or the bank deciding to increase the cost of their existing borrowing.

Rob Harris, local head of Close Invoice Finance said: “At a time when the country is struggling to get back on its feet, it’s astonishing that small businesses, the very engine room of our economy find themselves in a situation where they not only feel unable to access funds to grow, but actually lack the confidence to even ask for it in the first place.

“The survey also demonstrated that almost a third of businesses in the South West aren’t happy with the level of personal service they are receiving from their bank. Ironically though, our last Barometer showed us that the majority of firms remain reluctant to change provider – perhaps a case of better the devil you know.”

The research also revealed that businesses in the North West are least happy with the service from their bank (32 per cent), with firms in the South East at the other end of the spectrum, with 17 per cent discontent.

“It’s great to see that a third of businesses across the UK have plans for expansion over the next 12 months, but of course they will need to raise funding to do this.

“Given that so many appear to have somewhat broken relationships with their banks, it’s especially important that they realise there are other options open to them,” he said.

Invoice finance has been cited by the government as having a ‘crucial’ role to play in the recovery of the private sector. It’s a flexible means of funding that is moving steadily into the mainstream – it is currently outperforming all other types of business lending according to new statistics from the Asset Based Finance Association.

Total advances from members of the Association grew 9 per cent in Q1 of this year, compared to the same quarter last year. In the same period, bank lending contracted by 2.5 per cent.

“The key benefit of the product is that it can unlock up to 95 per cent of the value of your unpaid invoices, thus helping to ensure a healthy cash flow. Innovative businesses are quickly coming to realise its power but we still have work to do if more businesses are to understand the potential of invoice finance in helping them to achieve their growth strategy,” Mr Harris said.

The Business Finance Barometer is published on a quarterly basis, canvassing the views of 500 SME owner managers across the UK on a range of financial issues.

New research highlights role of migrant workers in South West

Rob Harris

Rob Harris of Close Invoice Finance

New research published this week shows that despite the government’s calls to reduce the number of migrant workers, nearly one quarter of South West bosses rely on them to plug the skills gaps in their workforce.

According to the Close Business Barometer, independently commissioned and published by Close Invoice Finance, of the 29 per cent of employers who hire migrant workers 53 per cent hire them because they are best placed to do the job.

The Close Business Barometer reflects the findings of a recent poll of firms by Young Enterprise, which revealed that a growing number of British students are graduating without adequate or basic skills to join the workforce meaning businesses fill the gaps in their workforce with foreign workers.

Commenting on the findings, Rob Harris of Close Invoice Finance said:

“Our survey shows that in contrast to the comments made by the current government, migrant workers play, and will continue to play, a vital role in the UK economy. British companies need to attract the brightest and best talent in order to compete in the globalised economy and as our findings show, it isn’t about where the person comes from, it’s whether or not they have the skills to do the job.

“In the current economic climate businesses are struggling on many levels, not least in terms of cash flow and migrant workers offer many sectors a level of workforce flexibility to enable them to survive. At this crucial time any attempts by government to cap the numbers of workers available could add even more challenges to business.”

Employers in the South East of England make the most use of migrant workers with 39 per cent of companies employing foreign nationals, while in the North West of England migrant workers account for only 20 per cent of the workforce.

Close Invoice finance is based in the UK, Ireland and Germany. To contact them call free on: 0808 159 3586 or Email: salessupport@closeinvoice.co.uk