Action call to ensure sighs of SMEs don't turn into screams

LLOYD POWELL HEAD OF ACCA CYMRU WALES

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AS WE head rapidly towards Christmas, there’s a kind of collective sigh you can hear among many Welsh small businesses.

Unfortunately, it’s not the eager sigh of anticipation as we approach the festive season, but rather the frustrated huff of a business owner who's just been told their invoice will be paid in 90 days... perhaps... but only if the system behaves.

And it’s not just a Welsh problem. According to ACCA's latest research, a staggering 35.6% of the UK's small and medium-sized enterprises (SMEs) reported problems with securing prompt payment, citing it as a major hindrance to growth.

The UK Government estimates suggest it costs the UK economy almost £11bn per year and shuts down 38 businesses every day.

These aren’t abstract figures - they're your local builder, tech startup or even hospitality business (no doubt gearing up for what will hopefully be a lifesaving festive season) waiting months for payments from clients.

And as any small business owner will tell you, the bottom-line calculation is simple: Will there be enough cash left to cover the payroll at month end?

ACCA has been broadly supportive of the Westminster government's recent Late Payments Consultation, agreeing that large companies through their audit committees or a designated individual should be held accountable for how promptly they pay their suppliers.