With 5.7 million SMEs in the UK in 2018 (accounting for 99% of all businesses), below we highlight the key issues that Britain’s SMEs are currently facing.

Whether you’re a one-man band, a medium-sized enterprise or a huge multi-national corporation, every business comes with its problems.

With 5.7 million SMEs in the UK in 2018 (accounting for 99% of all businesses), below we highlight the key issues that Britain’s SMEs are currently facing.

Cash flow

The UK’s late payment culture is responsible for killing 50,000 small businesses as owners simply cannot fund their businesses due to late payments. The late payment crisis means that small businesses are struggling, with cash flow being one of the biggest issues.

Some directors of small business have admitted to taking cuts out of their salaries to ensure a good cash flow for their business. Small businesses are collectively owed £26.3 billion which works out on average of £32,185 each.

It’s perhaps unsurprising that 92% of business owners questioned in the CMC Partners Survey revealed that they experience cash flow issues from time-to-time or consistently.

Small businesses rely on cash to keep daily operations running yet so many struggle to manage it effectively. While it’s perfectly normal to have cash flow inconsistencies, being in control is essential for the health of your business and also to free up some of your time so you can focus on managing and growing your company.

You can find some top tips for cash flow management here.

Under-performing staff

Managing people effectively can be an incredibly challenging task so it’s no wonder it’s a top concern for SMEs.

Most organisations will experience issues with an under-performing employee at some stage but dealing with this issue can be daunting. Few of us like conflict so when dealing with this issue, ask yourself the following questions:

  • Have you made your expectations clear to the employee in question?
  • Has the employee had sufficient training?
  • Is their workload too high?
  • Are they right for the job?
  • Are they having personal issues which could be affecting their job?
  • Are you communicating effectively with the person in question?
  • Is there another role in the organisation they may be better suited to?

Armed with this information, you will be able to put together an effective plan of action.

Brexit

We hate to mention it, but more than half of owner-managed businesses say their single biggest concern is how Brexit negotiations are going to affect them.

When asked about their specific Brexit-related worries, 38% said that the introduction of trade tariffs was their biggest concern, 30% fear a loss of EU labour and 23% are concerned about loss of European customers.

What’s more, just 6% of small and medium-sized businesses say that the Government is listening to their concerns about Brexit.

Mark Lamb, a partner at Moore Stephens who carried out the business poll, commented:

“Businesses thrive on certainty – it allows them to invest, scale up, take on more orders and expand their workforces. If the Government does not give them clear indications of what they can expect once the UK has left the European Union, it will be very difficult for many of them to invest in their growth.”

Staff and recruitment

A survey carried out among members of the Academy for Chief Executives back in September, revealed that SMEs identified people as the biggest issue that’s likely to have an impact on their business.

Their main concerns include:

  • Recruitment - recruiting enough people to support the growth of their business
  • Skills - finding candidates with the right quality talent, with the new skills needed for the demands of the business and with the appropriate educational capability to learn and bring learning with them to the business
  • Retention - retaining people with the right skills and developing their talents

If recruitment is one of your key concerns, please feel free to get in touch with Alpha and we will be more than happy to help.