Blog

Failing to negotiate is costing SMEs millions of pounds

23/03/2016 / Comments 0

Failing to negotiate is costing SMEs millions of pounds

SMEs could be missing out on significant financial benefits because they don’t negotiate with their suppliers, according to new research.

The study, commissioned by npower Business and conducted by YouGov, revealed that in the last year SMEs who negotiated with their suppliers saved millions of pounds.

Almost half (45%) of those that negotiate with their suppliers saved up to £10,000 in the last 12 months – resulting in estimated overall savings of £511million.

But, despite the obvious financial benefits, three quarters of business owners surveyed said that they do not negotiate.

Philip Scholes, head of npower business, said: “This research shows that businesses across the UK are reaping the dividends of negotiating their supplier contracts. However, not all firms are entering discussions with their provider, which could prove to be a missed opportunity in the long term.”

Getting the best deal for your business

With the power of negotiation key to slashing bills and making massive potential cost savings, how exactly can you get a good deal?

Well, more than half (59%) of decision-makers surveyed felt that their successful business negotiations were due to being prepared and doing their research. Meanwhile, 46% believed their success was because they are good at being flexible.

Also, funding facilities which boost your cash flow ahead of being paid by your customers could put you in a better position to negotiate as you’ll have money available to secure early settlement discounts.

For example, invoice finance facilities bridge the cash flow gap often associated with trading on credit terms by releasing up to 90% of an invoice’s value within 24 hours of its issue. This improved cash position can then help you secure supplier discounts.

Does your business negotiate with its suppliers? Please share your tips with our followers in the comments below so they can enjoy the benefits too.

Comments

No comments yet - be the first!

Funders we work with

  • Close Brothers Invoice Finance
  • Skipton Business Finance
  • Working Capital Partners
  • Factor 21
  • Secure Trust Bank
  • Roma Finance
  • iwoca
  • Market Invoice
  • Davenham Asset Finance
  • Positive Cashflow Finance
  • Leumi ABL
  • Creative Capital
  • Trade Finance Partners
  • ABN AMRO Commercial Finance
  • IGF Invoice Finance
  • Royal Bank of Scotland
  • Pulse Cashflow Finance
  • Catalyst Finance
  • Barclays
  • Hitachi Capital Invoice Finance
  • Outsauce
  • Team Factors
  • 1pm
  • Lloyds Bank Commercial Finance
  • Shawbrook Business Credit
  • Asset Advantage
  • Assetz Capital
  • Ultimate Finance Group
  • Amicus Commercial Finance
  • Invoice Cycle
  • Nucleus Commercial Finance
  • Bibby Financial Services
  • Woodsford Tradebridge
  • Metro Bank SME Finance
  • Ashley Commercial Finance
  • Partnership Invoice Finance
  • Regency Factors
  • Aldermore Invoice Finance
  • GapCap Cashflow Finance
  • Innovation Finance
  • PNC Business Credit
  • Santander Corporate & Commercial
  • Calverton Finance
  • Everline
  • Henry Howard Cashflow Finance
  • Platform Black
  • Davenham Trade Finance

Authorised and regulated by the Financial Conduct Authority (FCA number 730445)
We are a credit broker and not a lender and offer credit facilities from a panel of lenders

Our website uses cookies. For more information about managing cookies, visit our Privacy and Cookie Policy. Continue