The owners of small businesses in the UK are reporting increased levels of stress and anxiety as they try to plan a route back to profitable trading, according to a survey from ACCA UK (the Association of Chartered Certified Accountants) and The Corporate Finance Network (CFN).
A figure of 37% business owners said they were feeling more stressed and anxious than normal in June – which is more than double the figure for May (16%). The steep increase appears to be due to more uncertainty caused by the government’s decision to delay fully reopening the economy until July 19.
The SME Tracker, which reports what small businesses tell their accountants, also gave some insight into the slow roll out of Government support grants, with some local authorities making little progress in handing out billions of pounds in restart grants of up to £18,000 each.
The slow drip of support funds has led to fears that small owners may panic and make unwise financial decisions in a desperate bid to stay solvent.
Cash flow is still proving to be difficult for SMEs, with only one in five (21%) saying they have considered the impact of increased trading as restrictions start to lift. Only about the same percentage (22%) of clients have forecast their funding and cash flow for the next 12 months.
Worryingly, 40% of small businesses also say that the partial return to trading has been slightly or much lower than the level they expected.
The survey reported data from accountants representing 4,777 SME clients and ran until yesterday.
Claire Bennison, head of ACCA UK, said: ‘SMEs are reporting high levels of anxiety just when they need to be at their most creative and innovative to get their businesses back to successful trading.
‘We would appeal to them to talk to their accountant and to agree a financial plan for reopening and cashflow for the next 12 months. We are hearing about cases where SMEs are panicking and turning to the wrong financial options for their business. Government needs to do more to help SMES to know what the right support package for them is.’
Kirsty McGregor, founder of The Corporate Finance Network, said: ‘Government support grants, including Restart grants, are rolling out very slowly. Some businesses are having to wait months for this cash when they can least afford it.
‘Companies are going to be facing extra costs next month with the tapering of furlough and business rates relief, and local authorities should be directing business owners towards grants for which they are eligible, rather than just turning down applications where the criteria has not been met.’