An article by Graeme Forbes, head of corporate finance at Grant Thornton
The business outlook for small- and medium-size enterprises (SMEs) in the UK "continues to paint a relatively gloomy picture" according to the latest quarterly report by the Bank of England (BoE). The report states that among small manufacturing firms "uncertainty about demand persists and investment intentions remain weak", while a survey from banking giant Barclays reported "worsening performance in 2003 Q2".
A difficulty faced by SMEs is delays in payments from creditors: As the economy declines, so the length of time SMEs wait to be paid increases. Clearly the recent legislation into improving late payments remains largely unenforceable as smaller companies are unwilling to demand more rapid payments from larger customers for fear of losing their trade.
