Rob Straathof identifies the most common problems facing small businesses – and how to solve them
UK SMEs account for 99.3 per cent of all UK private sector business, as well as contributing a monumental £200bn a year to the UK economy – positioning them as a key part of the financial ecosystem.
However, recent research published by Liberis, revealed that 26 per cent of SMEs are struggling to stay afloat and subsequently require additional funding. Other reasons for needing a cash injection included; “keeping up to date” (30 per cent), “paying tax and bills” (23 per cent) and ‘marketing’ (34 per cent ).
Paying tax and bills
Ensuring tax and bills are paid on time is key to a maintaining a healthy cash flow and improving small businesses’ ability to stay afloat. The following tips should help you to manage your cash flow effectively.
- Financial forecasting – Efficient forecasting every 6-12 months will help you sustainably plan for nearly all incomings and outgoings and be better prepared for any unexpected expenditures. It is important to consider any seasonal factors too.
- Being organised – Creating and sticking to a logical administration system is a simple way to stay on top of bills. Implementing a “home” for paper bills and documents is a great place to start. It is also worth investigating ways in which you can automate your payments, which accounting software.
Keeping up to date
Keeping up to date with new technologies, consumer trends or regulations that may affect your small business is key to success, but often a time-consuming task. The following tips should help you to keep in the know, without costing you too much time.
- Analytics services – Free analytics services are now more available than ever and can be easy to use too. Subscribing to an analytics service is a great tool for any small business and makes available a huge amount of valuable information; from where the customer is from, to key topics, to what brings in the most traffic and conversions. Such insight it key to defining strategy and sales processes.
A good place to start your small businesses marketing drive is online and creating a presence on social media platforms can lead to plenty of opportunity. The following tips should help you to navigate the world of marketing through social media.
- Engage with customers – opening up a direct channel of conversation between your small business and its consumers could not be easier as you can now use comments, tweets or even polls to understand your audience better and position your brand effectively.
- Content creation – By creating and pushing out bespoke content, in the form of written or visual media, will determine your small business as a trusted resource, making it a hub for existing customers and attracting new ones.
Being prepared for these challenges, combined with securing the correct amount of funding is key to helping your business to not only stay afloat, but to meet and exceed its goals and ambitions.
Rob Straathof is CEO at Liberis, an award winning alternative finance provider, offering a better way to fund UK small businesses