Small businesses are the hub of the UK economy as they drive growth and create many employment opportunities. Their contribution to the economy is vital. So, it is important for them to survive.\u00a0 Covid-19 played a big part in our normal life and it affected small businesses tremendously. Many businesses had to shut down for months. Some of the business had to close permanently as they could not maintain the cash flow necessary to survive.<\/p>\n
UK Government has taken many steps to provide support for the business. One of the initiatives was to assist businesses with cash flows. The government introduced schemes such as grants, CBIL and bounce back loan. So, any business was eligible to apply and backed by the government.<\/p>\n
This helped many businesses to get back on their feet and get the necessary cash to support their day-to-day activity. Nearly millions of pounds were made available to the small businesses. This resulted in the injection of the flow of capital into the economy.<\/p>\n
It has been one year since the bounce back loan was introduced , and hence the repayment will start accruing shortly. This would be an additional outflow of cash that the business have to start considering. \u00a0Businesses must consider their going concern issue and change the way they report the accounts. Businesses must ensure that they have enough cash flow to meet the payments and monitor it significantly. Lack of cash is one of the biggest reasons small businesses fail.\u00a0 The Small Business Administration stated that \u201cinadequate cash reserves\u201d are a top reason start-up fail. It is called \u201crunning out of money,\u201d and it will shut you down faster than anything else. The first six months of a business is a crucial time for cash flow. If you do not have enough cash to carry you through this time, your chances of success are low. Suppliers often will not give credit to new businesses, and your customers may want to pay on credit, giving you a \u201ccash crunch\u201d to deal with.<\/p>\n
Now that lockdown has been lifted, businesses must take measures and have enough cash available so that they can be prepared if the same situation repeats in the future. \u00a0Businesses must take the steps slowly as this will take time for the economy to recover.<\/p>\n
The following steps could be taken as part of the measure:<\/p>\n
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Here at outsourced ACC we ensure that our clients have access to cashflow information in the case that they needed to make quick decisions. We work with all major accounting software providers to ensure we provide you with the best solution that fits you. \u00a0Putting out clients onto accounting softwares (which is fully inclusive in their package)<\/strong> helps them to maintain their books. All our client have benefitted significantly as they can make business decisions from present rather than historical information. We work effectively and efficiently to grow your business.<\/p>\n Get in touch with our team today to find out more.<\/p>\n