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Scottish SMEs not matching funding to growth aspirations

Bibby Financial Services have released their latest report on SME Sentiment Scotland, which can downloaded here. The report details a buoyant mood amongst Scottish SMEs with two thirds (69%) of owners predicting growth but the report reveals that when it comes to seeking business funding owners are failing to shop around.

Nine in ten Scottish SMEs say they’re not looking for external funding in the immediate future – even though 54 per cent are planning to invest in their business soon. Of those planning investment 72 per cent say they’ll be using their own money, rather than seek finance from elsewhere.

Investing in equipment and recruitment

Many of the businesses surveyed planned to invest in equipment and recruitment. At Bibby Financial Services we feel that there is a danger that SMEs could actually be inhibiting growth prospects by failing to investigate external funding. Looking for the best deals in alternative finance would make a great deal of sense if you’re planning for expansion.

Our research shows that those SMEs who do plan to use external funding to grow their business are not looking beyond traditional bank lending. Some 79 per cent are relying on bank loans and overdrafts in the main, this is despite the fact that other forms of financing including invoice finance could serve them equally well.

Enterprise Research Centre

A separate report carried out by the Enterprise Research Centre (ERC) found that alternative forms of financing are not used by SMEs due to a lack of awareness, financial expertise and confidence.

58 per cent of Scottish business owners looked to their accountants for advice on financing and it’s clear that these professionals have an important role to play in helping owners and managers make key decisions on the financing of business growth.

Traditional banking model

The needs of modern business are complex and varied, especially those businesses that are looking to implement growth. It’s vital that owners shop around make themselves aware of all the financing products available.

This should including looking into the benefits of alternative, non-bank finance. Being aware of all the options available on the market is the best way to make an informed decision.

Contact Bibby Financial Services

As the UK’s leading independent invoice finance specialist and a trusted provider of cashflow funding to over 7,000 businesses, Bibby Financial Services provides a range of finance solutions for businesses in over 300 industry sectors.

For more information about Bibby Financial Services’ cashflow solutions, visit: www.bibbyfinancialservices.com or call 0800 91 95 92.

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