Skip to content

Entrepreneurs Panel

Tony Caldeira
Steve Purdham
Debbie Pierce
Jeremy Roberts
David Pollock
Laura Tenison
Brian Hay
Julie Meyer
Jennie Johnson
Richard O'Sullivan
Michael Oliver
Charlie Mullins

Cashflow problems 'biggest risk to small firms'

Seven out of 10 SMEs see cashflow problems as the biggest risk to their business, according to a new survey.

The poll by Amicus Commercial Finance shows 38 per cent of SMEs have suffered from cashflow issues in the past two years, risking to 65 per cent among medium-sized firms with between 50 and 250 staff.

Over the past two years, one-in-seven (15 per cent) are still suffering liquidity problems and 12 per cent either came close to or became insolvent.

The biggest challenge caused by cashflow shortages is paying suppliers, cited by 41 per cent of business owners. This is followed by meeting debt repayments (30 per cent), buying inventory (29 per cent) and paying staff (24 per cent). One-in-five (18 per cent) said they had lost contracts due to cashflow problems.

On a sector basis, 35 per cent of finance and accounting firms reported being affected by cashflow problems. Regionally, companies in the North East have been the worst hit by cashflow shortages.

John Wilde, managing director of Amicus Commercial Finance, said: "Our research shows that most small firms recognise the damage caused by cashflow problems but that doesn't guarantee their immunity. The worst case scenario is insolvency but in our experience, slow paying invoices are often to blame. As working capital and cashflow are by their very nature dynamic, most traditional systems have failed to keep pace over the last few years."

  • Kathryn Parsons, co-founder of Decoded, started with little more than faith and determination, but four years later it’s grown into a global business. Ahead of her appearance at Accelerate 2015 in...

  • Author, writer and marketer Ryan Holiday on how entrepreneurs need to interpret failure.

  • Sue Vizard, business coach and author of Jump Start: The Start-up Book for Your Dream Business, looks at some of the questions solo entrepreneurs should ask themselves.

  • Ian Wright, founder and chief executive of, is bringing together SMEs and NEDs - without the hefty recruitment fees.

  • Former professional golfer turned entrepreneur Colin Stevens has had a busy 18 months. The Better Bathrooms founder has increased turnover at the firm, secured a multi-million pound investment and...

Five Minutes With

David Hughes sums up his entrepreneurial career to date thus: four spectacular successes and two failures. He founded the sports retailer Allsports and achieved turnover of £180 million before a vicious price war meant decline, administration in 2005 and a sell-off to rival JD Sports.

It took Richard Shonn, managing director of 151 Products, three years to find a warehouse big enough for his requirements.