Half of SME’s fear an income fall – business news 26 August 2021

Half of small businesses fear an income fall in the next year. The latest insolvency numbers. Car production slumped to lowest level since 1956 in July. Bank Holiday boom expected. Remote working could bring more older people into the labour market and more business news.

James Salmon, Operations Director.

Half of small businesses fear an income fall in the next year
Just under half of UK small businesses (49%) expect their income will reduce in the next 12 months, according to data from WorkLife by OpenMoney’s latest Small Business Monitor. This figure is up from 45% in the spring.

Additionally, just 26% of small firms now believe that their sales will increase over the next year, down from 31% in March. On average, small businesses expect to be back to pre-pandemic levels of income within 10 months of restrictions lifting, although 35% believe it will take between seven and 12 months and 23% think it will take more than a year. Steve Bee, director of WorkLife by OpenMoney, said the UK’s so-called “freedom day” had split the country’s small businesses into two camps: those who are feeling renewed optimism, and those who remain uncertain about the future.


The latest corporate insolvency figures for England and Wales reveal a 70.4 percent increase in creditors’ voluntary liquidations in July 2021 compared to July 2020.

While corporate insolvencies fell by 9.3 per cent month-on-month to 1,094, compared to June’s figure of 1,206, they increased year on year by 13.4 per cent.

However insolvencies are 24% lower than the number registered two years previously – pre-pandemic there were 1,442 in July 2019.

This is hardly surprising. Last month saw the lifting of the final lockdown restrictions and many businesses will now have to start making payments in relation to their BBLS and CBILS loans. However, many protections against insolvency persist. We expect the numbers to continue to rise as furlough comes to an end and the temporary restrictions on the use of certain creditor enforcement actions are lifted. It is inevitable that insolvency numbers will return at least to pre-pandemic levels relatively soon and probably higher for a period of time.

The moratorium on issuing winding up petitions, is due to end on 30 September 2021 which should trigger a sharp rise in corporate insolvencies in the coming months as creditors will be able to enforce their rights again. The end of the furlough scheme is also due at the end of September 2021, which will put further cash flow pressure on some companies in the region and will likely increase insolvencies in the last quarter of 2021 and the start of 2022.

If you are struggling for cash and facing insolvency, CPA could help you un-lock Late payment compensation on late paid invoices to businesses. Talk to us about un-locking compensation going back up to six years.

No face-to-face meeting required – just call Peter Uwins, CPA’s National Sales Manager, on 020 8846 0000 (business hours) or email nsm@cpa.co.uk today.

Car production slumped to lowest level since 1956 in July
UK car production fell sharply last month, marking the worst July performance for the industry since 1956. The Society of Motor Manufacturers and Traders (SMMT) said the global microchip shortage, staff being affected by the so-called pingdemic, and shutdowns meant just 53,438 cars were built in the month. That was a drop of 37.6% compared to July last year.

Overall car production in the year to date is almost a fifth higher than during 2020 at 552,361 vehicles, but that is still 28.7% down on 2019 pre-pandemic levels. SMMT boss Mike Hawes said the July figures “lay bare the extremely tough conditions UK car manufacturers continue to face”. More than a quarter of all cars made in July were either battery electric or hybrid electric, the SMMT said, the highest share on record.

Bank Holiday boom expected

Small and medium businesses in the UK are anticipating a Bank Holiday boom this weekend, according to new research by Barclaycard, as the public plans to mark the first national day off since the end of lockdown.

The seventh quarterly Barclaycard Payments SME Barometer shows that optimism in the leisure and hospitality sector is at its highest since before the pandemic, with six in 10 businesses expecting a surge in revenue. Some (13%) are prepping for the busiest Bank Holiday in a decade.

The research shows

  • More than four in 10 SMEs plan to hire more staff over the next 12 months
  • Nearly half of SMEs say their operations have improved during the pandemic
  • Concern about the impact of the pandemic is at its lowest since February 2020
  • Two thirds of retail businesses say customer numbers are equal or higher to before the pandemic

Rob Cameron, CEO of Barclaycard Payments, said: “Small and medium sized businesses hold such a significant position in the UK, accounting for around three fifths of the nation’s employment and half of the turnover in the UK private sector. The success and optimism we are seeing from this segment is an excellent gauge of how the wider economy is performing – and from that it’s terrific to predict that a bumper August Bank Holiday looks set to be on the cards.”

Remote working could bring more older people into the labour market
A survey by the Office for National Statistics last summer revealed that 11% of older workers permitted to work entirely from home were planning to retire later, compared with 5% of those not working from home. More working from home would help women, in particular, by keeping them in the labour force for longer. The ONS said a permanent shift to greater remote working could bring more older people into the labour market, helping to drive GDP growth. If the employment rate of people aged 50 to 64 matched that of 35- to 49-year-olds, it would increase the size of the economy by around £88bn, the ONS estimated.

Premier Foods tells staff they can work wherever they want
Premier Foods has become the latest large business to embrace hybrid working, telling its 800 office-based staff they can work wherever they want. The maker of Mr Kipling and Bisto gravy said its St Albans headquarters will remain but “work is a verb, not a place” and the office is not “somewhere colleagues have to be for the sake of showing their face”. HR director David Wilkinson said: “This isn’t about getting rid of the office, it’s about shifting our mindset on what it means to be flexible.”

Many parents will not leave money to their children
Following news that movie star Daniel Craig would not be leaving his fortune to his children, the Express cites research from Hargreaves Lansdown showing many agree with the James Bond actor. The survey found 82% of people plan to leave money to their children when they pass away while 7% plan to leave it to other family members. Sarah Coles, a personal finance analyst at Hargreaves Lansdown, commented: “It’s not just Daniel Craig: Almost one in five people don’t plan to leave most of their money to their kids when they pass away. Some have made sensible planning decisions for the benefit of their whole family.”

HMRC issues new tax scam warning
With tax-related scams roughly doubling over the past year, HMRC has issued a fresh warning over email, phone and text scams asking for money or personal information. The Revenue has now written to leading charities including Cancer Research UK, Citizens Advice, the National Trust and Gingerbread, urging them to highlight tax-related scams through their communication channels. Anyone could fall victim to these scams, HMRC has said, but they often target the vulnerable or busy individuals who may not see them coming.

UK insurers unready for stricter rules on pricing
As part of efforts to tackle the so-called loyalty penalty, from this October, insurers in the UK will be required to offer better value for money policies to existing customers. However, the Financial Conduct Authority says too many firms were failing to meet existing regulatory standards let alone the tougher rules coming in. Sheldon Mills, executive director for supervision, policy and competition at the watchdog, said insurers that were failing to follow existing regulations were putting consumers at risk of financial harm, since customers could be sold inappropriate or poor-value products. “These firms have significant work to do urgently to be able to comply with the enhanced product governance rules. Firms that fail to do that work risk regulatory action,” he added.

Grafton Group

Grafton Group reported record half-year earnings as revenue topped £1 billion. Revenue rose 46% to £1.03 billion from £703.7 million a year earlier. The Dublin-based, building materials distributor said it had now “fully recovered” from the impact of the lockdown in the first half of last year, with average daily like-for-like revenue 17% ahead of the first half of pre-pandemic 2019.


Costain swung to a profit in the first half of the year as revenue was boosted by an ongoing recovery in the construction sector. For the half-year ended 30 June 2021, pre-tax profit was £9.1 million compared with a loss of £92.3 million year-on-year as revenue increased to £556.8 million from £547.3 million.


Hays reported a slight rise in annual profit amid cost cuts and a recovery in the recruitment market. For the year ended 30 June, pre-tax profit rose 2% to £88.1 million even as net fees slipped 8% to £918.1 million year-on-year. The decline in group fees, however, came on the back of an improving backdrop. H1 fees were down 24% but H2 were up 13%.

South Korea

South Korea has become the first major Asian economy to raise interest rates since the pandemic began. The Bank of Korea increased its base rate of interest from a record low of 0.5% to 0.75%. The move is aimed at helping curb the country’s household debt and home prices, which soared in recent months.


The CEOs of 20 large American corporations, including  Apple, Alphabet and Amazon, pledged to spend billions to shore up the USA’s cybersecurity. Microsoft alone has pledged $20bn over five years. US President Joe Biden summoned the executives after a series of damaging security breaches at US companies had crippled the country’s infrastructure, compromised privacy and led to massive ransoms being paid to cyber criminals.

Why should you become a CPA member!

The Credit Protection Association (CPA) has been assisting thousands of UK businesses to get paid since 1914. We have seen many financial crises, this one will be particularly deadly for suppliers for some time to come.

CPA eases cash from tardy debtors – Efficiently, Effectively, Economically and Ethically. And we provide credit information so you can monitor and assess your key customers.

Unlike other credit management companies, we charge our members a fixed annual subscription irrespective of how high the debt value is!

It takes less than 17 minutes to see how you would benefit, do you have the time now?

No face-to-face meeting required – just call Peter Uwins, CPA’s National Sales Manager, on 020 8846 0000 (business hours) or email nsm@cpa.co.uk today.

When you see your money come in, you will be so glad you used CPA.

The Credit Protection Association – Prompting Punctual Payments – Ethical, Effective, Efficient, Economical collections

Get compensated for previous late payments

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The Credit Protection Association – Prompting Punctual Payments – Ethical, Effective, Efficient, Economical collections.