Smaller businesses 'better at managing risk'

Date: 8th May 2009

Small organisations are better at managing exposure to bad debt than their larger counterparts, it has been revealed.

An investigation by Close Invoice Finance found that companies with less than 50 employees had significantly less ageing debt than those with up to 249 staff.

Despite the promising statistics, managers should always consult with an accountant on how to best handle financial risk and obligations.

Chief executive of Close Invoice Finance, David Thompson, commented: "This study proves that smaller … [businesses] have been more successful than their larger cousins at successfully managing exposure to the risk of bad debt."

Mr Thompson added that effectively supervising cashflow was more important than ever during a downturn in the economy.

Figures published by Continental Research this week revealed that 55 per cent of smaller firms have not been profitable since last year.