small business finance

Basic Budgeting for Your Small Business

Basic Budgeting for Your Small Business

When starting a business your head is often filled with grandiose dreams of becoming the new leader in your sector or changing the way the market works with your offering – it is unlikely that the prospect of drawing up a budget was what excited you about becoming an entrepreneur. But budgets are absolutely crucial in keeping control of your business and ensuring you have a realistic roadmap for success. This article will provide you with an introduction to creating a budget – we cover sales, costs and cash budgets, and how to convert these into a projected balance sheet. Finally, we examine what to do when your actual figures differ from predictions, and the steps you can take to address this. How do I draw up a sales budget? A sales budget essentially predicts how much you expect to sell... »

New Regulation Expected for Payday Loan Comparison Websites

New Regulation Expected for Payday Loan Comparison Websites

Payday loan comparison websites (PCWs) will have to get to get to grips with new regulation following a recent update from the Financial Conduct Authority (FCA). The FCA has formally responded to the investigation carried out last November by the Competition and Market Authority (CMA) which is working on remedies to high-cost-short-term lending companies (HCSTS), or those offering payday loans. This response follows the introduction of a price cap on payday loans introduced in January 2015 that limits the amount payday lenders can charge to 0.8% daily interest or £124 per £100 borrowed. In an effort to increase competition in the industry, safeguard customer details and improve transparency, the CMA presented six remedies to improve competition: Enable consumers to search according to the ... »

How to Implement a Cost Control System in Your Business

How to Implement a Cost Control System in Your Business

Although it might be a painstaking process, assessing your business costs and implementing a cost management system is worth it. Smart cost control can bring immediate benefits to your company, as well as lay the foundations for greater efficiency going forward. But it is important to cut costs wisely – only slashing away here and there will just bring about worse quality and poor morale. Read on for comprehensive information on how to properly introduce a cost control system into your business, and how to avoid some common pitfalls. What are my first steps in cost control? Before you look at cost-saving measures, your first step in controlling your overheads is to look carefully at what you’re currently spending. Start by identifying your ‘cost centres’. Cost centres are the parts of your... »

A Small Business Guide to Managing Your Creditors

A Small Business Guide to Managing Your Creditors

Your relationship with your creditors is a major determining factor in the overall health of your business – get it right, and they can be a valuable friend in times of need. Get it wrong, however, and dissatisfied creditors could spell the end for your business. If you always pay creditors on time, there is rarely a problem. However, late payment from customers, wastage, poor sales, and a million other potential incidents could see your cashflow suffer, and it is in these situations that a good relationship with creditors is crucial. In this article, we cover how to manage your creditors smartly. You will learn how to identify the most important creditors, and how to manage them with a clear, transparent payment policy. We then cover how to deal with specific creditors, including your ban... »

Small Businesses Leverage Cashflow to Fund Growth

Small Businesses Leverage Cashflow to Fund Growth

More than half (59%) of Britain’s small firms are using cashflow to fund growth as many believe it’s too “expensive and time-consuming” to seek funding traditional lenders; the national Working Capital Outlook Survey by C2FO has reported. 60% of small businesses said it was too expensive to borrow from banks and the report found that only 30% of UK companies are able to borrow money for an APR of under 6% – with firms in the financial and insurance sector borrowing at the highest rate of approximately 7.2%. The survey featured over 400 small and medium businesses and quizzed them on a range of financial issues, including how they preferred to improve working capital and deal with late payments. While many business owners said they were trying to finance development using operational cash, ... »

UK Small Businesses Forced to Re-Mortgage in Order to Keep Afloat

UK Small Businesses Forced to Re-Mortgage in Order to Keep Afloat

The government may be failing the UK’s small businesses with 60% having to had to re-mortgage or use personal savings in order to keep their business afloat. According to new research by Sage, 84% of small and medium companies have never received any financial or other type of support. The research also found that small business owners are “forced” to work overtime in order to keep their firm running. 26% said they work over 50 hours a week while 56% admitted that they worked weekends and the same proportion said they failed to take their holiday entitlement last year. While 65% of British entrepreneurs said that they planned on hiring up to five employees in the next two years to help manage the workload, one in five said they worried about being able to pay staff. The survey also asked s... »

Third of Small Businesses Rely on the Internet for Financial Advice

Third of Small Businesses Rely on the Internet for Financial Advice

Small businesses risk coming into financial problems with 30% having admitted to using unregulated information on Google and social media for essential financial advice, according to a new survey by IGF Invoice Finance. The report found that only 4% of small business owners currently use an accountant or other trained expert for financial advice and, while the internet can offer a range of useful business information – the report warned that small business owners need to ensure they are “obtaining sound advice from trusted, reliable sources.” The findings are subsequent to a report by Direct Line for Business which found that poor consultancy resulted in a £6.4bn loss for micro and small firms – affecting an estimated 320,000 enterprises. Managing director of IGF Invoice Finance, Tra... »

Business Funding in ‘Traditional’ Companies Reaches “Record High”

Investment in non-tech businesses grows from 24% in 2011 to 45% in first half of 2014 The rate of business investment has increased dramatically in the first half of 2014 according to new research, with ‘traditional’ industries outside of the technology sector reaching “record” levels. The report, by data firm Beauhurst, suggests investors are taking a “more balanced approach”, with the rate of investment taken up by non-tech companies increasing from 24% in 2011 to 45% so far in 2014. Traditional businesses such as professional services, industrial industries retail and leisure all witnessed considerable growth. The business and professional services sectors gained £338m in investment in the first half of 2014, compared to £279m for the whole of 2013. Additionally investments in industria... »

What is Supply Chain Finance?

What is Supply Chain Finance?

Supply Chain Finance has been in the news recently. Prime Minister David Cameron is backing supply chain finance as a “new” form of finance for small- and medium-sized businesses. He claims that, “…this scheme will not only help them [small businesses] secure finance and support cash flow, but will help secure supply chains for some of our biggest companies and protect thousands of jobs.” If you are a small business who supplies a large, probably well known company, you will know better than most that just because they are reputable does not mean they are on time with paying their invoices. In fact, it can often make them worse as they know they have the power to do what they want and pay invoices later and later. This is where supply chain finance is meant to fill the gap. Before we... »

Protecting Yourself from Your Customer’s Problems

Protecting Yourself from Your Customer’s Problems

Securing customers is an integral part to the life of any small business. Without customers you’ll be unable to sell your products or services, spelling financial trouble for your enterprise. But securing your customers is only half the battle.Once you have them in place you need them to pay. You can invoice them but you can’t always legislate for your customer’s financial position. A client’s insolvency or inability to pay is a huge issue which could really affect the viability of your business. To maintain your cashflow and protect yourself against bad debt, it’s vital that you investigate leading debt factoring solutions and choose an option that fits in with the needs of your business. How does factoring work? It’s all very simple. Once you’ve chosen a specific factoring agent all you ... »

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