According to a recent report, the UK’s small and medium-sized enterprises aren’t aware of all funding options for their business, despite almost half of those surveyed planning to expand in 2015.
The government-funded British Business Bank revealed that 46 per cent of SMEs are in line for growth in the coming year, following the release of the report. Around 1,000 small businesses were surveyed, with the findings indicating that, while most had sought finance, knowledge of alternative options was limited among business owners.
Local authority and government grants were unheard of by 33 per cent of SMEs, while 65 per cent had never heard of export and import finance, peer-to-peer lending or crowd funding. Over two thirds of the respondents did say they were confident they would be able to obtain finance from an external source. According to the report, the most common types of finance to be used were hire purchase or leasing and credit cards, with 95 per cent citing the latter option.
Reasons for borrowing varied, with 33 per cent using the finance to support cash flow and 43 per cent using the money to buy fixed assets. This is the first research to be carried out by the British Business Bank and, according to Business Secretary Vince Cable, it will be useful for the Government when aiming to improve awareness of alternative finance.
“This is particularly important given the findings also show that almost half of British small and medium enterprises plan to expand in the next year.”
How can a small business accountant help?
Right from the very first day of business, an accountant will help you to decide which business structure is the most suitable. Tax planning is another strategy used by accountants to maximise revenues early on.
The completion of tax returns, dealing with HMRC investigations, and other duties faced by a small business owner can all be dealt with by a reputable accountant, which will save money in the long term. An accountant will also explain various types of alternative funding, pointing you towards the option most suited to your requirements.
For those planning to expand their businesses during the next year, a cash flow forecast is crucial to reduce unnecessary risks.
If you need advice on the various financial routes you can take on the road to entrepreneurial success, get in touch with the team here at The Accountancy Partnership.
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We work very closely with our expert accountants to bring you the latest factually correct tax and accounting news. We also enjoy writing about small business news that we hope you find useful!