Support overlooks a million small firms – business news 18 February 2021.
James Salmon, Operations Director.
Support overlooks a million small firms, lock-down leaves 2m without work , house prices up in December, tax, covid-19, market and other business news.
Here are CPA we want to share the business news stories we have seen that we think will affect our members and readers. Many of us are busy fighting to protect our businesses and therefore might have missed some of the news that could impact small businesses, their owners and those that sell on credit.
Support overlooks a million small firms
The Federation of Small Businesses (FSB) has warned that a million small businesses and sole traders “overlooked” for emergency coronavirus support need assistance, with one in five small companies missing out due to the way assistance has been targeted.
An FSB poll of more than a thousand small business owners saw one in five said they have received no financial help from the Government amid the pandemic, while separate FSB research suggests one in two firms have not been able to gain access to a cash grant and only one in twenty had received discretionary help from their local authority.
The federation has urged the Chancellor to extend cash grants and business rates reliefs and called for the threshold at which businesses start paying rates to be permanently increased. FSB national chairman Mike Cherry said that while too many small firms have been left out of support measures, “it’s not too late to bring those left out into the fold.”
Lock-down leaves 2m without work
A report from the Resolution Foundation think-tank says close to 2m people have been unable to work for at least six months after losing their jobs in the pandemic or being placed on furlough.
Its calculations put the total at 1.9m, far steeper than official statistics showing a total of around 1.2m. The report says 700,000 workers had been unemployed for at least six months in January and a further 500,000 had been on full furlough, working no hours at all, for the same period.
The Resolution Foundation says one in five of the people not working fear they will remain jobless or their roles will vanish when the furlough scheme stops on April 30. Meanwhile, a survey by the British Chambers of Commerce found one in four companies will have to lay off staff unless furlough support is extended beyond April 30.
House prices up in December
House prices saw the strongest growth in six years in the final month of 2020, figures from the Office for National Statistics show. House prices were up 8.5% year-on-year in December, hitting an average of £252,000. This compares to growth of 7.1% in November and is the highest annual growth reading since October 2014. Wales saw the highest growth, with prices rising 10.7% to an average of £184,000, followed by England with an 8.5% increase taking the average to £269,000. The increase in the UK average seen toward the close of 2020 has been driven by pent-up demand amid the initial lockdown and the stamp duty holiday, with analysts saying demand and prices may wane as the tax relief comes to an end at the end of March. Howard Archer, chief economist of EY Item Club, said elevated housing market activity and robust prices “will prove unsustainable sooner rather than later” and p redicted that prices will fall by around 5% this year.
London prices dip
London’s mini property boom came to a halt in December, official figures show, with prices seeing their biggest monthly fall since the market reopened in May. The average cost of a home in the capital was down 1.1% in the month to £496,066, according to data from the Land Registry. The dip dragged the annual growth rate down from 7% in November to 3.5% in December. Property experts said the shift was likely to be caused by buyers abandoning transactions, believing they would miss March’s stamp duty holiday cut-off.
Inflation up to 0.7%
Inflation rose in January, with Office for National Statistics data showing the consumer prices index rose to 0.7% last month – up from 0.6% in December. The increase came as food retailers pushed up prices and furniture retailers and household goods stores did not offer the level of discounting seen in previous years. Andy King, the head of consumer price inflation at the ONS, said the end of the Brexit transition period did not appear to have had a noticeable impact on prices, despite border disruption. Some experts have warned that inflation could exceed the Bank of England’s 2% target by the end of 2021. Samuel Tombs of Pantheon Economics said January’s increase “marks the first step this year towards an above-target rate by the autumn”, while Karen Ward of JPMorgan Asset Management said inflation is expected to be at 2% by year end “but it could be higher than that”. Fidelity International’s Ed Monk said t he outlook for prices is “pretty confusing”, adding: “It will take a few months and an ending of current restrictions for the full picture to emerge”. PwC’s Hannah Audino says renewed demand in service sectors hit by restrictions and the end of VAT cuts could see an increase in prices, while an expected increase in unemployment as the furlough scheme ends “will increase spare capacity in the labour market and subdue wage growth, putting downward pressure on prices”.
Small chains and vacant sites targeted by expanders
City AM says the UK’s bigger pub and restaurant chains – as well as private equity firms – are circling smaller chains and vacant properties, looking to snap up expansion opportunities at a discounted price during the pandemic “and reap the rewards when the industry bounces back”. It cites figures from restructuring firm Resolve showing that between September and December 2020 there were 28 M&A transactions in the hospitality sector, a 75% increase on Q3. The paper also notes that a moratorium on landlords evicting commercial tenants ending could see a surge in company collapses, with Begbies Traynor’s Julie Palmer expecting a spike in the number of firms “showing significant distress and the number of businesses that start to fall away”.
£176m hit for Arcadia creditors
Topshop and Topman creditors are facing losses of £176m as the Arcadia retail empire is wound up, more than double a previous estimate. Analysis shows that creditors are owed £219m in total but there are only £42.4m of assets available to pay them. The figure falls far below a November estimate by administrator Deloitte, which suggested £82.2m was owed to creditors – although the firm warned that the true amount would be much higher.
Covid-19 general news
There were 12,717 new cases in the UK yesterday (total 4.07m) with 738 more deaths (total 119k).
Globally 393,682 new cases brought the total to 109.9 million with 2,430,512 deaths.
Almost 187 million vaccine doses have now been given worldwide.
Nearly a year after the World Health Organization declared covid-19 a pandemic, global infections rates appear to be showing signs of slowing down. The were 2.7 million new Covid-19 cases last week, the lowest weekly figure since October. The weakest percentage gain since the start of the pandemic and less than half the rate we had last month. The death toll is also easing. Fatalities have averaged less than 10,000 per day over the past five days, down from a peak of more than 18,000 in mid-January.
Coronavirus cases have declined strongly across England since January, according to the latest study, suggesting that the current lockdown measures have worked to drive infection rates down. The study, known as REACT-1 and led by researchers at Imperial College London, found that national prevalence was two thirds lower between 4 and 13 February than it had been between 6 and 22 January. The number of infected people fell to 51 per 10,000 at the time of the latest survey in February, down from 157 per 10,000 in January.
The U.K. is set to carry out the world’s first study to deliberately expose volunteers to the new coronavirus to speed research. The human challenge study was approved by a research ethics committee and may eventually help accelerate development of vaccines and treatments and take on variants.
A study shows Pfizer Inc. and BioNTech SE’s Covid-19 vaccine stimulated roughly two-thirds lower levels of neutralizing antibodies against the South African variant of the coronavirus in a lab study.
United Nations Secretary-General Antonio Guterres called for a global vaccination effort, urging the Group of 20 countries to coordinate it. “The world urgently needs a global vaccination plan to bring together all those with the required power, scientific expertise and production and financial capacities”
Markets.
Yesterday stocks took a break from their rise as inflation concerns (and the effect on future interest rates) dampened the mood. The FTSE 100 closed at down 0.56% at 6710.90 and the 250 Closed down 1.25%. The Euro Stoxx 50 fell 0.71% and the 600 fell 0.74%, Overnight, the S&P 500 fell 0.03% and the NASDAQ dropped 0.58%.
Asian Markets mostly fell this morning with profit-taking and growing worries about inflation being the main themes, which offset long-running optimism about the global recovery as vaccines are rolled out.
Sterling continues to strengthen and is at 1.1532 Euros and 1.3917 US Dollars.
Oil Prices were mixed in afternoon trading yesterday, underpinned by a major supply disruption in the southern United States this week where a winter storm hit Texas, but pressured by reports that Saudi Arabia plans to increase output in the coming months. Brent Crude is at $64.82 after briefly going above $65 and Gold is down at $1786 as US treasury yield rises weakened the appeal of the safe haven.
Counters Confidence climbs
A quarterly survey of Accountants by the ICAEW shows that accounting firms are more optimistic about a return to growth this year. The majority of the 1,000 accountants surveyed were hopeful for a return to sales growth if the pandemic is contained.
IHT reclaims hit six-year high
The number of Inheritance Tax (IHT) reclaims reached a six-year high in 2020. Figures released by HMRC following a Freedom of Information request by financial advisers NFU Mutual show there were 6,262 reclaims in 2020. This marks an increase on 2019’s total of 5,499. Analysis of the data shows that there were a total of 4,419 reclaims on loss of property value, nearly 600 more than 2019. There were also 1,843 reclaims for shares sold at a lower value – a small increase from 2019’s tally. Sean McCann of NFU Mutual said the figures show more people are becoming aware they can reclaim overpaid IHT.
MPs: Tax rethink can drive a green recovery
The Environmental Audit Committee has suggested tax cuts could help drive a greener Britain, arguing that a reduced VAT rate could incentivise businesses and households to reduce carbon emissions. Committee chair Philip Dunne said a tax system “fit for net-zero Britain is key”, adding that it will “encourage innovation, give confidence to the sector and support companies to make the low-carbon transition.” The MPs also urged ministers to “begin scoping work on a carbon tax” in an effort to propel a green recovery from the coronavirus pandemic.
Taxes set to settle pandemic bill?
The Independent’s Ben Chu says policymakers and analysts are considering whether tax rises will be required to cover the cost of the coronavirus crisis, with emergency support measures and a pause on collecting certain taxes hitting state coffers. He says Chancellor Rishi Sunak is examining the case for future tax increases, with corporation and capital gains levies said to be potential targets and a new digital sales tax possible. Mel Stride, chair of the Treasury Select Committee, has this week suggested a one-off wealth tax may be the way to go, with a Wealth Tax Commission report suggesting such a levy would delay permanent tax rises.
Ministers sceptical over unconscious bias training
Michael O’Dwyer in the Telegraph says ministers are sceptical over whether focusing on unspoken prejudices will improve workplace equality, highlighting that unconscious bias training sessions for civil servants in England were scrapped last year. Michael O’Dwyer notes that during a controversial virtual meeting which led to his departure, KPMG chairman Bill Michael said there is “no such thing as unconscious bias” and suggested that “after every single unconscious bias training that’s ever been done, nothing’s ever improved.” This, Mr O’Dwyer says, shows that ministers’ doubts about unconscious bias training “are mirrored in some boardrooms” – even if directors do not voice the opinion publicly for fear of drawing criticism. It is noted that KPMG has offered unconscious bias training to its staff, while PwC made sessions mandatory following 2020’s Black Lives Matter protests
Don’t let Covid-19 bust your business!
It will if your cash flow dries up, either sooner or later.
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 sometime to come.
CPA eases cash from tardy debtors – Efficiently, Effectively, Economically and Ethically. Above all tactfully, because maintenance of goodwill is paramount.
To meet the needs of creditors in the current crisis, we have designed a “critical care” package especially tailored for the situation.
- The annual package costs start at very low rates
- A minimum performance warranty is provided
- Several complimentary services included
Clients instruct CPA on-line via their PC or phone, completely user-friendly. Your late paying customers are told to pay you direct (not to us).
A very recent report shows a 23% increase in the number of unpaid invoices since March 11th THIS YEAR – are you getting a build-up of late payers?
Right now, overdue accounts must be a concern and CPA has a great track record of encouraging slow-payers to pay their suppliers quickly.
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.
Do you sell on credit?
With pressures on the cash flow it is essential that you stay on top of the credit limits you grant customers and watch carefully for any late payments.
Those customers will look for the easiest option to boost their cash-flow. Don’t let it be you.
You can’t just assume your customers can and will pay you eventually, no matter how big their name is.
It is essential to have credit management systems in place to monitor and check your customers credit worthiness.
It is also best practice to use a trusted third party like CPA to make sure you are paid on time by customers, no matter how good a name they have.
About CPA
The Credit Protection Association can help!
Formed in 1914, CPA has been providing credit management services to SMEs for over 100 years.
At the Credit Protection Association, we provide first class credit information that can help you avoid being over extended to customers who are at risk. Our monitoring service can flag up warning signs long before the end, giving you the chance to adjust and reduce your exposure. We provide recommended credit limits and credit scores on a traffic light system and can help you set appropriate credit policies for your customers.
We regularly publish lists of the latest insolvencies but by then it is too late. Our credit reports however predict approximately 96% of company insolvencies long before they arrive.
Companies in trouble usually have very bad cash flow and they try to deal with it by delaying payment to their suppliers, increasing your exposure to them.
If you supply on credit, help us help you identify the risks.
Why use a third party collector?
As a third party collector, we can also get your payments prioritised over those who are not as hot on collections. When your customer receives a letter from the Credit Protection Association regarding their outstanding account, they are going to want to get that resolved as a priority. Our overdue account recovery service can get your unpaid invoices to the top of their “to do” list and get your invoice paid.
Over the years we have collected billions in overdue invoices for our customers.
Our debt recovery and credit management services give our members the financial freedom needed to grow and prosper, while our new Late Payment Compensation department could unlock hidden potential and offer the compensation needed to springboard your business to success.
You might be hesitant about contacting a debt collection agency. What are they going to be like?
Can they help your particular type of business?
There is no need for concern. CPA are courteous, helpful and very probably have had direct experience of working with your type of business.
Debt collection agencies are not all alike.
Success lies in both recovering money and keeping customers happy. The Credit Protection Association was founded in 1914 and has helped tens of thousands of UK businesses to collect outstanding payments and reduce the risk of incurring bad debt. We believe that creditors deserve to be paid for the work or goods they have supplied but we fully understand the need to maintain
the best possible relationship with customers!
At The Credit Protection Association, we provide solutions, advice and back-up in all areas relating to the supply of services or goods on account. Client-members receive everything they need from a single source to reduce debtor days and write-offs.
The Credit Protection Association has helped has assisted tens of thousands of UK businesses with their credit control requirements, since the First World War.
We are polite, firm and efficient when it comes to recovering outstanding debt.
“We have used CPA for a number of years now. The website is easy to navigate around with lots of helpful reports. The staff are always at hand and very friendly. CPA has helped us reduce our debt over the years and keep track of potential issues with our customers.”
~ CPA client in Buckinghamshire
“The service from CPA has proved to be everything that you said it would be. We have already seen a huge benefit. We have had a number of overdue accounts paid promptly and directly to us. It is also a huge weight off our mind to know that once we have passed an overdue payment over to you, you take care of everything whilst keeping us informed.
~ Credit Controller client in Warrington
The Credit Protection Association – Prompting Punctual Payments – Ethical, Effective, Efficient, Economical collections
Ready to speak to an advisor?
For help or advice on credit management, entirely without obligation.
Call us today
0330 053 9263
CPA is passionate about late payment
The Credit Protection Association has been protecting smaller firms against poor payment practices for over 100 years.
We are extremely passionate about breaking the late payment culture that holds back the UK economy and threatens many SMEs, with cash flow difficulties being the single biggest killer of Britain’s small businesses.
If you were regularly paid late we can help. Those former customers used you to boost their own cashflow, regularly paying you late.
As a result you had extra costs, you had the distraction of having to chase payment, you had opportunity costs because your capital was tied up in their late invoices.
Under little used legislation, you are entitled to compensation for those late payments.
You put up with the PAIN – now claim the GAIN!
Now you can boost your own cash-flow.
CPA can help unearth the those hidden treasures.
We have the technology to reveal the compensation you are due and we have the extensive experience and expertise to then turn those claims into cash.
Did you know that your business is entitled to a minimum of £40 for every commercial invoice paid late to you over the past 6 years?
How many of your invoices are paid late each month – 20, 50, 100 or more?
At £40 per invoice that’s claim of £57,600, £144,000, £288,000 plus interest. The more invoices the bigger the claim!
At £100 per invoice it’s £144,000, £360,000, £720,000 plus interest.
For over 20 years, CPA has calculated and recovered Late Payment Compensation on behalf of Clients!
Yes, CPA can help you boost your business cash-flow.
Don’t let your bankers control you, contact CPA today.
The Credit Protection Association – Prompting Punctual Payments – Ethical, Effective, Efficient, Economical collections.
Do you realise you could be sitting on a fortune?
Late payments often result in a cash flow crunch and leave SMEs in need of a cash injection.
If you sold B2B on credit then there may be a hidden source of capital you can call on.
If you fancy an extra bit of extra cash in your business, rather than jumping through hoops with your bank, you could look to uncover the resources from an unexpected source within your own business.
Not many are aware but there could be a hidden fortune within your business, sitting there, just waiting to be uncovered and released.
We can help you uncover the pile of gold, you didn’t even know you were sitting on.
If you trade with other businesses and were often paid late then you could be entitled to significant compensation.
Under little known and under-utilised legislation your business could be due huge amounts in compensation that you didn’t even know about.
Let’s be clear – this is not a way to weaken any customer relationships you value. It is one that identifies who’s been paying late and then recover the potentially significant sums in compensation using Late Payment Legislation from businesses where the relationship has already ended.
You can pick and choose who you want us to follow up – but once we’ve agreed which companies you’d like to pursue compensation from it’s a fast process and there’s no financial outlay to you whatsoever. My team at CPA put its expertise to work to recover the compensation due and fight late payment culture.
That compensation could provide the cash boost your business needed.
But don’t delay, that compensation evaporates if not claimed within six years of the late payment.
How can CPA help?
CPA has developed a unique technology to dig into your accounting records and discover the cash injection you are due by means of compensation. The software does all the hard work. Our software interacts over the cloud with over 300 different software packages, working directly with your accounts package, just so long as it’s stored on a computer.
We recognise that most companies do not have the resources to spend time on the identification and calculation of Late Payment Compensation. Our service can produce an Analyses within just a few days with (usually) less than 30 mins of co-operation from our clients. We work directly with over 300 accounting packages but can also work with bespoke accounts packages. Indeed, speed is essential as the oldest invoices may fall foul of the 6-year time limit.
Once the Sales Ledger Analyses is made available to clients, all that is required is that management decide which commercially sensitive ex-customers to remove from the list and return it to us.
CPA then uses its years of collection experience to explain and recover the Late Payment Compensation Claims. Clients do not handle any part of the recovery process as our team will take all communications from the companies against who the claims has been made. Often, it’s simply a case of explaining the legislation, sometimes we have to go all the way and enforce the legislation through the courts.
The result is that we are realising clients’ claims worth tens and sometimes hundreds of thousands of pounds which, of course, is pure net profit. You may also be among the recipients of “hundreds of thousands of pounds” should you elect to take advantage of our services.
We do the work, you receive the cash.
If you have supplied goods and services to businesses on credit and were regularly paid late then you could be due significant sums in late payment compensation.
We are talking to companies and unearthing claims in the hundreds of thousands from former business customers who paid them late. Large business customers who abused their power to inflict unfair and sometimes illegal payment practices.
We are helping business owners who are looking to boost the returns from their business before they retire. We are helping businesses who have lost major clients after years of loyal service to get properly compensated for systematic late payment. We are helping companies that were looking to close down, who looked insolvent and finding that cash injection they need to avoid insolvency.
Those former clients who regularly paid you late can finally be made to pay.
Ready to speak to an advisor?
For help or advice on credit management, entirely without obligation.
Call us today
0330 053 9263
The Credit Protection Association is a credit management company established in 1914. If you supply goods or services on credit then we can help you!
The Credit Protection Association – Prompting Punctual Payments – Ethical, Effective, Efficient, Economical collections.
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The Credit Protection Association – Prompting Punctual Payments – Ethical, Effective, Efficient, Economical collections.