I read last week that UK SMEs are collectively losing over £8.72 Billion every year as a result of the time taken to complete weekly finance related tasks such as company expenses.
The survey, conducted independently by YouGov, revealed UK SMEs spend an average of just over 4 hours every week managing a range of financial outgoings including invoicing, accounting, expenses, budgeting and forecasting. It also found that it’s the startups that struggle the most with day to day cash flow management, with 15% of them find managing outgoings particularly difficult.
In my opinion, it is really vital that SMEs take care of their finances, especially when looking for investors. Whether you sell goods or services, you need to make a profit. And you can’t do that unless you manage your finances and cashflow carefully. Although the survey reveals that a lot of time and money is taken up by day to day management of a company’s cash flow, I believe taking care of business finances are a vital part of running a successful, long term business and investors like to lend to companies who manage their pennies and pounds responsibility.
It can often seem overwhelming or tedious having to keep track of spending, but in the end, it’s always worth it.
If you or your company is struggling to manage your finances you could hire someone to specifically oversee that particular part of the business, or if you’re strapped for cash try incorporating new technology into the management of day to day expenses, whatever you decide to do, don’t lose control or neglect to keep track of your company’s expenses.