Corporate insolvency is an ever-present threat to all businesses, but particularly to fledgling firms that may not yet have developed their cash flow to a particularly robust extent.
With less fallback finance in the bank and a smaller ongoing client base, any new start-up is exposed to unexpected financial shocks to a greater degree.
But it seems a quarter of SMEs might be particularly under threat, due to their owners’ inability to manage everyday accounting tasks effectively.
A study from First Data Merchant Solutions, a supplier of card terminals and payment processing services, shows that 25% of decision-makers in SMEs have found accountancy and tracking finances to be more difficult than they anticipated.
Nearly half (44%) have missed a celebration or occasion of some kind because of the extra time they put into their business – and one in ten have even cancelled their own birthday.
But it is the threat of corporate insolvency that should be the biggest worry for business leaders, as it represents the collapse of all that time and effort.
As such, those on the cusp of business insolvency should seek administration advice as soon as possible – it might be the difference between losing the invested time and money, or achieving corporate recovery and carrying on trading.
Production
