Thinking Small over the Big Question of Business Finance
Big name banks have gone to the wall, or received billions of pounds to keep them afloat; big nameshops have reported falling sales, and big name manufacturers have cut back on production. It can be easy to overlook the fact that the overwhelming majority of businesses are not big names at all.
But if small firms sometimes lack the visibility of the big brands, they are no less important. Indeed, small businesses employ more than 800,000 people in the West Midlands.
And without their supply chain, larger businesses such as Jaguar would be unable to function.However, small business are often the first to suffer when the economy goes downhill.
They are vulnerable to bullying by larger businesses, who delay paying bills in an effort toimprove theirowncashflow.There's often little that small businesses can do to object, even though the effect on their own cashflow is extremely damaging.
Theymay also find that banks areunwilling to supply them with credit.
And although some are insulated slightly fromthe effects of reduced consumer spending, as they may be some way down the supply chain, they will soon feel the pinch if consumer confidence drops. …