Chasing late payments and ensuring a strong cash-flow are often seen as SMEs’ biggest challenges. However, the last 18 months have seen small-business leaders fight to overcome an increasingly demanding hurdle: complying with swiftly changing regulations.
Having surveyed 1,225 SME leaders in the UK, Hitachi Capital Business Finance, the financial-services firm, has revealed that concerns about legal compliance have jumped by 9% over the past year and a half. This means these issues are now British small-business leaders’ top concern with 28% of them struggling with it. These worries have overtaken managing cash flow, which 26% found to be challenging. Additionally, a quarter wrestled with bureaucratic red tape, a fifth struggled with retaining business and 14% had problems sourcing talent.
But it’s hardly a secret why regulatory concerns have climbed to the top of head honchos’ priorities. After all, the last two years have seen them face off against a multitude of changes to the legislative landscape. Not only are they forced to deal with whatever regulatory framework leaving the EU will result in but they must also comply with the General Data Protection Regulation, gender-pay-equality rules, the new Criminal Finances Act 2017 and last year’s binning of employment tribunal fees.
Commenting on the research, Gavin Wraith-Carter, managing director at Hitachi Capital Business Finance, said: “Over the past 18 months the mountain of paperwork for small businesses has become taller and the fact this is now their chief concern ahead of others issues gives some insight as to what they are facing on a day-to-day basis. With Brexit, there is likely to be tighter control on regulation for many businesses in and outside the UK.
“But the huge positive [is] that it is clearly not denting small business confidence. This quarter two in five enterprises anticipate growth in the next six months – a slight rise from the previous quarter and the quarter before. Our research also shows that more small businesses plan to hire staff, invest in new equipment and expand into new markets or overseas.”
Indeed, it’s encouraging to see that British businesses haven’t lost their bullishness despite facing off against the transforming legal landscape.