|
The study, carried out by the FPB and commercial credit agency Graydon UK, questioned 400 small businesses on their individual experiences of seeking financial advice. The results reveal that 70 per cent of those questioned choose to consult their accountants for this type of advice, compared to only 47 per cent who look to their bank managers as trusted advisers.
The data also indicates that only 20 per cent of owners and managers of small firms admit to seeking financial advice quarterly or more frequently. When asked what prompts them to seek professional financial advice, 68 per cent of respondents replied "only when I think it is necessary".
Worryingly, 36 per cent of those surveyed admitted that they have not met with their accountants or bank managers in the last year, with one in four (24 per cent) putting this absence of contact down to either a lack of faith in their advisers' knowledge of their businesses or the fact that they have received poor advice in the past.
The FPB's Chief Executive, Phil Orford, added: "An issue that has not been reported as widely as lending restrictions is the declining level of service being offered by the banks. There is an increasing trend of established relationship managers being replaced by individuals in call centres, which leads to the loss of long-standing and profitable business banking relationships.
"In light of these changes, it is not surprising that more small-business-owners are turning to trusted accountants rather than their bank managers when seeking financial advice. However, it is a concern that they are not sourcing help more frequently, particularly in these testing times. A return to previous levels of service – which means good working relationships between bank managers and business-owners – would allow banks to manage risk more effectively and provide the appropriate access to finance to those that need it."
Martin Williams, Managing Director of Graydon UK, said: "The traditional ‘grey-haired pillar of society' stereotype of the bank manager as a trusted and respected source of financial advice has faded into the past. But as the economy hits upon hard times and banks become increasingly nervous about credit limits, SMEs need now, more than ever, to maintain a close dialogue with their bank managers."
"We certainly do not want a repeat of the last recession, when the relationship between banks and small businesses broke down completely."
On a more positive note, nearly one in three firms surveyed (29 per cent) said that they are seeking more financial advice now than they were a year ago, with 37 per cent expecting that they will need to take more advice over the year ahead.
|
