Invoice finance has been shown to increase turnover and business confidence, according to new figures. Not only that but it has also been shown to help a range of sector who otherwise might be struggling. Invoice finance is amongst the most influential non bank funding methods, helping many SMEs boost their turnover – some even achieving pre-recession levels.
During the second quarter of 2012, many of the 4,000 businesses surveyed who are using non-bank financing experienced a boost in their turnover. There were strong performances in the manufacturing and construction sector particularly, as well as transport, wholesale and business services. This echoes findings of the National Institute of Economic and Social Research, who also reported a rise in manufacturing activity in May. This could be down to the moving of the bank holiday to June to coincide with the Queen’s Jubilee.
450 of these businesses were also interviewed about their business outlook – this also reported significant gains. New orders, new inquiries and growing confidence about trading conditions show growing positivity in some areas.
This shows that boosting turnover is important for businesses not only in terms of money but also in terms of their business confidence, demonstrating the role that funding can play in driving up business performance. The improved turnover figures of this sample of businesses also shows the importance of non-bank funding for the UK economy as a whole.
However, though there is generally good news coming from the survey, it’s also evident that the continuation into double dip recession has had an impact. The 51% who believed trading conditions were steady is a down from 58% in Q1, and the 23% who have experienced an increase in orders this quarter is also down from 28% in Q1. This shows that while invoice finance is playing a big part in helping the UK’s SMEs, there’s still a long way to go in the face of ongoing economic difficulties.