Small business cash flow ‘is a wider issue’

Following the announcement of a Small Business Commissioner to advise on supply chain disputes and late payment, the Forum of Private Business has warned that there are much wider issues at stake in small business cash flow.golden-tap-with-gold-coins-rushing-out-of-it

The Commissioner – which some are calling a Late Payment Tsar – would be able to intervene in disputes, with the intention of mediating them to a mutually agreeable conclusion, without the need for businesses to go to court.

However, the FPB has questioned whether the government is truly committed to the interests of small businesses, after having seemingly neglected them multiple times when setting up expert panels and action groups.

First there was the Chancellor’s Star Chamber, which co-opted former FSB chairman John Wright after realising small businesses were not represented on its panel, and now the Business Advisory Group has failed to include small business representatives, according to the FPB.

“Once can be considered an oversight, but twice…?” asked FPB managing director Ian Cass. “We do not doubt the competence and quality of the individuals involved, but their experience of current legislation, supply chain issues and even the tax system are based on corporate life, and not that of businesses with limited resources.”

The FPB adds that small business cash flow is hit by everything from the cost of pensions auto-enrolment to uncertain access to finance, and from regulatory costs to HMRC investigations – putting it under broad and considerable pressure.

While much of this is out of your hands as a small business owner, you can protect your bottom line through effective credit control measures, which should also result in more organised records if you ever need to prove your income in a finance application or HMRC inquiry.

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