Can your business spot a problem before it starts to impact on business performance? If you manage to do so, it can add up to big savings. Spotting things earlier makes everything easier to deal with. So what common problems should SMEs be looking out for? And how can you go about solving them? It pays to think ahead so you can start to look what’s affecting your business.
Common business problems encountered by all sorts of SMEs include:
- Lack of sustainable profit: This is the root of all sorts of issues and is one of the hardest to solve. This can all come back to lack of sales, no matter what sector you’re in, but if you try to grow too far too fast, this can also mean your growth is not sustainable and will start to cause problems due to overextension.
- Cash flow: Cash flow can again come back to customer sales, but equally it can be an issue arising from poor invoicing procedure. If your invoices are late to go out, incorrect or not chased up, customers will start falling behind on their payments and you’ll be left with tight cash flow.
- Late payment: This is hard to solve as you’re reliant on others to pay their debts. Being caught up in a supply chain can mean that you’re low down the list and customer keep putting off getting their payment through – this is especially the case if you’re supplying large supermarkets or chains.
These are just a handful of the most common business problems for SMEs. However, if you want a means of financing your way out of trouble, then invoice finance can help. This is a great way to unlock working capital, get cash flow moving and ease late payment problems. If you can solve these common problems, then you’ll be miles ahead of many of your rivals – getting the basics right can really pay off!