Smart Data Foundry’s Post

Sage’s Small Business Tracker, based on data from over 136,000 companies and analysed by Cebr and Smart Data Foundry, shows UK SMBs are weathering tough economic conditions. They recorded average real revenue growth in the final quarter of 2023, while overheads and capital expenditure fell. This culminated in stronger profit growth. However, the persistent issue of late payments, affecting over 40% in Q4 2023 alone, underscores the need for smart targeted Government interventions. Read more here: https://lnkd.in/gqEVUmAM or the coverage by eg The Independent at https://lnkd.in/gRkGYSzS

According to recent findings from the NFIB Small Business Optimism Index, there's been a notable shift in concerns among small business owners. Inflation has now taken the lead over labor quality as the top challenge. As a dedicated accounting management firm serving small businesses, we're always keeping an eye on these shifts to better support our clients. Curious to learn more about how these changes could impact your business? Dive into the details here: https://loom.ly/JripX6g 📈✨

Over the past year, we surveyed over 4,500 small business owners worldwide to understand how they’re managing cash flow amidst high inflation and rising interest rates. The survey findings, compiled into a series of Money Matters reports, were released in Australia, Canada, New Zealand, Singapore, the United Kingdom, and the United States. Here are five key trends from these reports, highlighting the cash flow challenges faced by small businesses in these six countries.

Did you know that poor cash flow is one of the main reasons businesses struggle? In fact, almost three-quarters (72%) of small business owners in the UK admitted to experiencing cash flow issues in the past 12 months, with one in 10 reporting significant difficulties. Cash flow isn’t just about tracking money coming in—it’s about timing and planning. Late payments, uncollected debts, and mismatched timing between expenses and revenue can sink even the most profitable businesses. At GG Financial Consulting, we work with businesses to optimize cash flow, ensuring you have enough liquidity to cover operating expenses, pay suppliers, and drive growth. We help you forecast cash flow, identify gaps, and plan for slow periods—because cash flow should support your business, not hold it back. 💡 According to a report from Xero, small UK businesses are owed £23.4 billion in late payments, a major factor impacting cash flow. If your cash flow needs attention, get in touch with us to book a consultation. Together, we can create a cash flow strategy that keeps your business running smoothly, even through challenges. #Cashflow #Smallbusinessfinance #Businessgrowth #Financialconsulting

I sat down recently, tea in hand, and had a good think about what advice I can give in today’s economic downturn. And it’s not ‘drink a load of whiskey and overindulge in delicious desserts’, although that might sound appealing. (Just me, or?) Many UK businesses are hit hard by economic downturns. Why? There’s many reasons, some being industry specific but to name a few: Increased costs, supply chain disruptions, increased competition, government policies… the list goes on. All of these factors create uncertainty and hesitance within businesses. How can this be avoided? Firstly, try to understand your financial situation and then take proactive steps to position your business for long-term success. Here are some examples: - Forecasting: Create a detailed cash flow forecast to understand your income, expenses, and overall accounts. This will help you identify potential problems before they happen. - Boost your profitability: Review your pricing, expenses, and revenue. Are you making enough money to cover your costs and generate a profit? If not, consider adjustments to increase profitability. - Optimise your payment processes: Put efficient systems in place for invoicing to ensure timely payments (I recommend Xero). Follow up on overdue invoices promptly. - Take action: Be proactive and make necessary changes to your business operations. This might involve cutting costs, increasing revenue, or restructuring your business model. These four steps will make a difference and help prepare your business for challenging times. Struggling with time? I’d suggest getting some professional advice (my kettle’s always on! ☕). What have been your main struggles through the current economic downturn? #accountant #accounting #accountancy #economicdownturn #businessowner

What’s the true measure of a company's #EconomicPerformance: #NetIncome or #OperatingCashFlow? ➤ Let's dive into Kamila Company’s recent year to understand this better. Imagine the company signed $30 million worth of consulting contracts but only completed $20 million worth of work. They collected $13 million in cash and spent $15 million on specialized engineering computers and software. At first glance, it seems straightforward, but is it? ➤ #NetIncome and cash flow are often confused, but they tell very different stories. #OperatingCashFlow represents the actual cash generated or consumed by a company's core operations. For Kamila, despite signing contracts worth millions, they collected only $13 million and spent $15 million, resulting in a negative cash flow of $2 million. This figure is precise, with no room for estimates. ➤ On the other hand, #NetIncome is a measure of #EconomicPerformance. It’s calculated as revenue minus expenses. For Kamila, they created $24 million in value for customers but consumed only $5 million of their $15 million investment in computers and software, considering these assets will last three years. Hence, their #NetIncome stands at $19 million. ➤ This example highlights the difference between cash flow and #NetIncome. #OperatingCashFlow shows the liquidity position, essential for paying employees, suppliers, and taxes. Meanwhile, #NetIncome, which includes estimates and accruals, provides a refined measure of #EconomicPerformance, indicating the value created for customers minus the value consumed. → So, which do you think gives a better reflection of a company's #EconomicPerformance: the precise #OperatingCashFlow or the refined #NetIncome? #Finance #Accounting #OperatingCashFlow #NetIncome #EconomicPerformance #EconomicValue #FinancialHealth #BusinessInsights

From the Autumn budget, an important update for small businesses: Starting 1 October 2025, companies bidding for government contracts over £5 million per year will be excluded if they don’t pay suppliers within an average of 45 days. While this policy holds businesses accountable, it doesn’t address the systemic causes of late payments that many small businesses still face. That’s why, at Local Loop Merseyside, we’re taking a proactive approach. As the UK’s first Clearing Club, we’re bringing together local experts to tackle the root causes of late payments and support small businesses in managing cash flow. With partners like Hayfield Bookkeeping & Accounting, we’re working to build a more resilient financial ecosystem for businesses across #Merseyside. #SmallBusinessSupport #CashFlowSolutions #LatePayments #LocalBusiness #MerseysideEconomy #ClearingClub #BusinessResilience #LocalLoop #UKBusiness #FinancialResilience #AutumnBudget2024 #SupportSmallBusiness

New research from Grant Thornton UK LLP finds that mid-market business confidence is faltering ahead of the Autumn Budget on 30 October as profit growth expectations sink to a three-year low and confidence in their funding position continues a downward trajectory since the beginning of the year. https://lnkd.in/eaEK59cq #business #SouthEastBusiness #businessconfidence #AutumnBudget

"Just heard something shocking, Bill. Did you know one in five UK accountants are charging over £1000 for basic small business accounts?" "Hmm, it's not surprising Jack. I've experienced varied pricing in my business too. It's alarming considering such discrepancies." "Righto! The study by Informi reveals the North East is the most expensive, with nearly a quarter charging over £1000. Can you imagine?" "No kidding! Not just that, Jack, Northern Ireland accountants are the least steep. It’s vital to do our homework." "Absolutely, I was staggered to learn that 38% of small businesses surveyed have no idea what their accounts preparation should cost. Another 35% don't even know if they're being charged reasonably!" "That's wild! Businesses must research and make informed choices. The aim is to ensure value for money and not be stung by high fees." "Couldn't agree more, Bill. Seems like a little shopping around for an accountant can go a long way." "Definitely. It's time we pass this wisdom on to other business owners too, Jack." #ValueForMoney #AccountingFees #ShopForYourAccountant

New CPA Australia data shows how Australian small businesses could benefit by adopting innovative technologies and practices.