Nearly half of business owners fear they’ve held back their business by having a naive attitude towards cashflow during their company’s infancy.
Almost two-thirds of those who identified cashflow naivety as their largest regret suggested that they overspent before gaining any profit, ultimately leaving them in larger debt than they could manage.
Those in the business services, such as sales or marketing regretted their attitude to cashflow, with 65 per cent in these sectors claiming it almost ended their business venture, training providers were second most regretful and manufacturing third.
Industries in London feel they regret their cashflow decision with almost half of business owners feeling they made mistakes, which was fractionally higher than the national average of 47%.
The study gathered data from business owners to identify what UK SME’s view to be their biggest financial mistakes.
Gaining enough funding was also a major regret with two in five business owners claiming they made the wrong decision in starting a business with the budget they had.
Recruiters felt they made the worst choice with 62 per cent stating they didn’t take advantage of better funding options; this was followed by the manufacturing and retail industries.
Those in the arts felt the most comfortable with their start up budget as only 1 in 5 claimed they had any regrets regarding funding.
More than a quarter of business owners claimed they “didn’t know they could receive loans and grants” and simply used their own money to help support their start up.
Those in the legal sector had the least knowledge on funding options available to them, this was followed by owners in transport and logistics and healthcare.
Although the details of grants and loans can vary depending on business location, over one in four of the surveyed business owners in London admitted they had never researched options available to them.
Shockingly, more than a quarter of UK business owners regret not creating a financial plan or forecast during their start up.
Compared to the national average, less business owners in London regretted their financial planning with only 22% fearing they’re hampering their businesses due to a lack of forecasting.
Lack of funding for marketing during a start-up was also highlighted as a major regret for UK business owners, with more than a quarter claiming they didn’t budget for this expense.
The biggest culprits that didn’t have marketing budgets include business owners in transport and logistics, recruitment and manufacturing.
More than a third of businesses registered in London failed to put any budget towards marketing.
Surprisingly, 13% of UK business owners don’t regret any of the financial decision they made during their start-up.
Andy Dodd, Managing Director at Hitachi Capital Invoice Finance, who conducted the research, said, “It’s fascinating to find out just how many businesses have lacked financial planning such as not forecasting or budgeting for key start-up essentials such as marketing costs.
“We are really passionate about helping people start their own businesses and try and support wherever we can, I hope this survey allows new business owners to look at their own financial planning and re-consider those critical spends they need to plan for.”
