30/03/2011
UK business failures have been reduced by 7.9 per cent over the last year as strong management and savings have helped firms keep afloat, reports startupdonut.co.uk.
Credit management firm Equifax collated public figures for their January to February Business Failures report which found that fewer businesses went under than in the same period last year. Good business management, such as cost control and cashflow management, were central factors in keeping UK businesses alive.
Neil Munroe, Equifax external affairs director, said to knowledge.hsbc.co.uk: "There are probably more small businesses practising good credit and cashflow management now than before the recession.''
"Some small firms will have had a few close shaves with customers and suppliers and that has made them more vigilant."
Other ways small businesses can generate increased cashflow is through utilising tools like sales finance to free up cash tied up in unpaid invoices.
"A lot of firms have taken basic cost cutting measures, like hiring and investing in new equipment - the things that have the biggest impact on cashflow," said Munroe. "However, they need to remain cautious and make sure they check out customers and suppliers on an ongoing basis, particularly this year as we are unlikely to see growth until the end of 2011."
Ashley Curtis