Eight in 10 small business owners have concerns related to cash flow, new research has found, with a small business lender highlighting how brokers can help provide a solution.
A new YouGov study of small businesses, commissioned by non-bank lender Prospa, has found that business owners are particularly engaged in their businesses, with more than half (54 per cent) spending six or seven days a week on their business. Further, more than a quarter (28 per cent) have said that they work seven days a week.
Even when not at work, small business owners continue to be engrossed in their business, with almost three-quarters (73 per cent) of the 250 business owners surveyed agreeing that concerns around their business prevent them from relaxing during the holiday period.
Younger small business owners between 18-49 years were more than twice as likely (39 per cent) as those 50 years and over (16 per cent) to strongly agree that concerns around their business prevent them from relaxing during the holidays.
However, regardless of age, eight in 10 (78 per cent) of small business owners said that at least some of their business worries are related to cash flow.
Interestingly, cashflow was a more significant business worry for women than for men and women.
Further, two-thirds (65 per cent) of small business owners said they feel stressed during the holiday period because of cash flow problems in their business.
More than a third (35 per cent) of women said they strongly agreed that they were stressed during holiday periods because of cash flow problems in their business, compared to less than a quarter of men (22 per cent).
The study also found that the more business owners worry about cash flow, the more likely they are to constantly think about their business.
The incidence of cash flow related worries also corresponds to small business owners feeling that they more frequently miss out on quality family time.
Overall, 90 per cent of SMEs said they were distracted by work in other areas of their life, with nearly 80 per cent saying that they sometimes miss out on quality time with their family and 28 per cent saying they miss out frequently.
Commenting on the findings, Prospa joint CEO Beau Bertoli said: “Concerns about cash flow during the holiday period can create a great deal of stress and distracts from spending quality time with family and friends.
“Small business owners make big sacrifices to build a better future for their families. Managing a small business takes its toll, and it can be difficult to switch off.”
Mr Bertoli added that brokers were therefore well placed to support SMEs at this time of year.
The joint CEO said: “Brokers can provide valuable support to small business owners at this time of year. Two-thirds are stressed and distracted by cash flow during the holidays and for many different reasons. For example, invoice-based clients are dealing with slow payments and the quiet January period, creating a cash flow squeeze. December is the busiest time for most retailers and staff costs are high. Meanwhile, CBD cafes and shops see a noticeable drop in foot traffic as regular customers flock to the beach.
“Brokers should talk to their clients about how their sector, location and customer habits impact cash flow during this time. With the right funding solution, they can give small business owners peace of mind.”
Annie Kane is the editor of The Adviser, Australia’s leading magazine for mortgage brokers.
As well as writing news and features on the Australian broking industry, the mortgage market, financial regulation, fintechs and the wider lending landscape – Annie is also the host of the Elite Broker podcast and In Focus podcasts and The Adviser Live webcasts.
Before joining Momentum Media in 2016, Annie wrote for a range of business and consumer titles, including The Guardian (Australia), BBC Music Magazine, Elle (Australia), BBC Countryfile, BBC Homes & Antiques, and Resource magazine.
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