Cash flow holds businesses back from recovery
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Business cash flow could prove to be a major stumbling block during the coming months of recovery, according to a report from the British Chambers of Commerce.


In its Quarterly Economic Survey, the BCC identifies positive performance in Q4 2013, which it says is an indicator that 2014 should continue the upward trend.


But for cash-strapped businesses, being able to keep their finances on track with the growing economy is likely to prove challenging, making expansion and investment harder even in a climate of growing consumer confidence.


John Longworth, director general of the BCC, says: “Cash flow continues to be an ongoing concern, and may hold businesses back from expanding to meet the growing levels of demand.


“We must give companies the opportunity to get the finance they need to go out and trade the world if we are to succeed in rebalancing the economy.”


The Q4 results show five indicators at all-time highs in the manufacturing sector, including domestic orders, employment, employment expectations, turnover confidence and profitability confidence.


In the services sector, both export orders and export sales are also currently at record positions.


This all leads the BCC to put GDP growth at around 0.9% in Q4 2013 – but as the first results of 2014 begin to be compiled and published, the availability of adequate business funding could prove to be a vital factor in determining whether GDP growth can be sustained.

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