New research has revealed that Britain’s small business owners are digging deep into their own pockets – and the bank of mum and dad – to keep their firms afloat.
The survey by finance provider Hitachi Capital found that 30 per cent of small firm bosses use the money in their own bank accounts to meet business goals. More than 15 per cent utilise personal overdrafts, while almost one-in-ten turn to family members for financial support.
With their own personal funds at stake, UK small business leaders cited cash flow issues as their biggest worry. Almost one-third of small business owners are kept awake at night by money problems – with worries about late payments and unexpected charges topping the list of concerns.
Only one-fifth of the 1,000 small firm owners questioned had accessed external financial support – including business loans and invoice financing – in the last 12 months.
“Small firms account for 99 per cent of our entire economy, so it’s critical that we enable owners to efficiently manage their business and support them in their growth ambitions” said Gavin Wraith-Carter, managing director of Hitachi Capital Business Finance.
April, July and October were found to be the most stressful months for entrepreneurs.
“Peaks and troughs across the year are inevitable for any small business and accessing financial solutions can help manage these periods as well as helping to overcome any unexpected hurdles,” Wraith-Carter added. “At a time when many banks are withdrawing overdrafts and cutting back on business loans, business owners need to consider the full range of options available to them.”
London mayoral candidate Sadiq Khan recently admitted to experiencing sleepless nights over financial worries when running his own business prior to moving into politics.
Additional research carried out by Instaprint in February 2016 revealed that more than ten per cent of small business owners are so concerned about ensuring the success of their firm that they get less than four hours sleep each night.
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