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Cost Cutting or Investment?

Many small businesses in the UK are putting cost cutting before investment in their companies. With recovery still stuttering, the focus is on improving margins and reducing debt, rather than further expansion. However, growth is just what is needed in the current climate. Alternative small business funding options are one way to achieve this.

Cost Cutting

In a recent survey, only 20% of the 309 entrepreneurs interviewed by an accountancy firm were looking to invest further in research and development this year. This is a blow to the government, which is looking to boost small business growth in 2012.

From April this year, the government will increase research and development tax relief for small businesses to 225% of qualifying materials. This is the most recent addition to measures trying to boost innovation in the smalll business sector.

A ‘patent box’ scheme is also due next year, which will tax profits from patented intellectual property at a lower corporation tax rate  of 10%. This again will encourage small businesses to think outside the box and invest in innovation.

If small businesses reduce invest in research and development in the short term, then there is a big chance that many businesses will lose their competitive edge in the long term. This is the last thing that SMEs will want, especially as many rely on their ability to stay ahead of the curve.

Competitive Edge

If your business is looking to keep up with research and development plans, then asset finance and invoice financing are ways to achieve the funds necessary. You won’t need to rely on the banks, and you won’t have to commit to long term high interest rates. Funding can be quick, secure and flexible.

Factoring and invoice discounting can release funds tied up in unpaid invoices, which your company can re-invest in growth and expansion plans, as well as research and innovation. There’s no need to let your business stagnate – it really is possible to boost your cash flow, stay ahead of the curve, and keep your business moving forwards.



Select Factoring.

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