We know cash flow is vital to the success and growth of any business. That’s why over the past two years, we’ve studied the topic to better understand the behaviors, attitudes, and cash flow challenges experienced by small businesses and self-employed professionals around the world.
Not surprisingly, for the second year in a row, we found that payroll has a profound impact on small business cash flow. This is because payroll is often one of the largest expenses for small business. In fact, 39 percent of businesses globally say that at least 30 percent of their expenses goes toward covering payroll.
It may sound obvious, but if a business doesn’t have cash, it can’t pay its workers. This year, more than 4 in 10 (43 percent) of small business owners said they have frequently been at risk of not being able to pay their employees by payday.