Small businesses losing billions on forgotten invoices
For any small business in the UK, finances can be a struggle, particularly in the current difficult financial climate.
Many smaller businesses have struggled to stay afloat over recent years, with lack of funding access from some major banks making the situation even more difficult.
However, despite this small businesses are collectively losing out on billions of pounds each year as a result of their own oversights.
According to a recent report, small and medium sizes businesses in the UK could be missing out on £3.7 billion a year as a result of forgotten invoices. This is according to a report from software specialist Exact, which carried out a survey on 450 SMEs.
The results showed that a worrying 20 percent of participating companies had forgotten to send an invoice for services or goods provided on at least one occasion. Even more worrying was that in 12 percent of these cases the amount of the forgotten invoice was between £5000 and £10,000. In 6 percent of cases, the amount was for more than £10,000.
An official from Exact said that many small and medium sizes businesses were not helping themselves when it came to growth and financial success, particularly in the current climate. With so many businesses struggling financially, forgetting about such huge invoices was having a huge impact on their financial wellbeing.
In addition to highlighting the situation over forgotten invoices, the study showed that one of the biggest causes of stress for SMEs was trying to find new business, with 31 percent experiencing worries over this particular issue. This was followed by financial worries, with 23 percent of businesses that were polled worrying about finances. This included debts, business planning, and general cash flow issues.
Around 25 percent of business owners said that they did not feel as though they were in full control over their business accounts and finances, with nearly half having to put off making payments as a result of cash flow issues. This included failing to make timely payments to staff as a result of cash flow issues. Over half of SME leaders said that the person they most trusted was their accountant.
Financial issues for many small and medium sizes businesses have become a huge problem over recent years. However, the government has put various initiatives into place in order to boost lending levels to businesses to try and help reduce this problem.