Small companies are missing out on new business opportunities due to inadequate funding arrangements, according to a study.
The research by GE Commercial Finance discovered that more than one in 10 (13%) small firms had lost an average of £1.39m in extra sales and the total amount of lost business for the sector came to £52bn.
Over a quarter of companies questioned (26%) said they had missed out on at least opportunity, with 52% saying they had lost between one and five and 18% claiming to have missed out on more than five business opportunities.
The research suggested much of this was down to poor understanding of how to get the finance needed to expand. Nearly half (48%) said their financial advisers could do more to help them improve their chances of getting the funding they need while just over a fifth (22%) said they would like more advice on the advantages and disadvantages of different types of funding.
A further one in five (18%) said they wanted help with putting the right funding structure in place for their business, and nearly one in six (16%) said they would like help with choosing the right provider.
“With firms across the country predicting a healthy year of growth, it is vital that they secure the right amount and type of funding early on if they are to achieve their goals and minimise missed opportunities,” said John Jenkins, chief executive of GE Commercial Finance, business finance division.
“Professional advisers have a big role to play in supporting firms by ensuring that they can understand and access the right funding solutions appropriate to their business and, crucially, at the right time,” he added.
Companies in the north-west have missed out on the most funding, the research claimed, with 15% missing out on an average of £6m each, while the north-east had the highest percentage of firms missing out on more than five opportunities (29%).