According to an analysis of figures from Companies House, the amount of money that smaller trade firms put back into their business has jumped 27% in just 3 years. The study focussed on smaller trade businesses, including plumbers, electricians, decorators, plasterers, scaffolders and roofing companies.

It’s partially believed that the rise is due to a shortage of bank lending and increasingly poor rates for smaller businesses. Banks are seen to focus on larger businesses who they see as having more chance of repayment and security against failure.

It’s this that has led business owners and directors to step up and pay their way in order to plug the spending gap. Many directors have been seen to make personal sacrifices in order to ensure a smooth cashflow in the business, the worry is whether this approach is sustainable.

It has been suggested that smaller construction firms may need to readjust the way in which they work. This could include unlocking the value of unpaid invoices with invoice finance or by leasing equipment instead of purchasing outright to ensure cashflow is steady.