Accounting platform, Xero, has reported that SMEs have seen a significant drop in revenue during April and May, compared to the same period last year.
Xero has found that SMEs saw a 26% drop in revenue in April, with a further drop of 28% in May. To add to small business pressures, the research also showed that since February, invoices are taking longer to be paid, up from 30.7 days to 38.5 days.
We have written on many occasions that late payments are a huge issue within the SME community. Add to that, even longer payment times due to the coronavirus and many SMEs are likely to face significant cash flow issues.
Unfortunately, all industries have been affected by the coronavirus, with hospitality and arts and recreation being hit the hardest. Although, there is a positive sign that both manufacturing and construction are starting to bounce back. The full revenue breakdown provided by Xero can be found below:
|Industry||April 2020 Revenue||May 2020 Revenue|
|Arts & Recreation||-41%||-41%|
|Rental, Hiring, Real Estate||-21%||-20%|
|Information Media & Telecommunications||-10%||-18%|
*year on year revenue comparison. Source: Xero
So, how can we help?
It is highly likely that even before lockdown you had a debtors’ ledger with various outstanding invoices. You may have exhausted your in-house collections process and found yourself at a dead end, thinking you’ll have to write it off as a bad debt.
DO NOT DO THAT!
Just imagine if you could recover that money, it might be the difference between you fighting to live another day or ceasing to trade. We provide honest, free advice on the likelihood of recovering your debt and if we think we have a fighting chance of getting what is owed to you, we will do this on a no collection, no fee basis. Basically, this means if we aren’t successful, you don’t pay us a penny!