Family Business Report 2024: Almost 50% of business owners are concerned cashflow may not cover outgoings


49% of business owners are worried about the impact of cashflow and not having enough to cover their outgoings.

This was one of the key findings in Armstrong Watson's latest Family, Privately Owned and Owner-managed Business Survey, in which 34% of respondents expressed that they were ‘somewhat concerned’ that they would not have enough cashflow to cover outgoings, and 15% admitting they were ‘significantly concerned’.

49% were also worried about the impact of the increase in the National Minimum Wage (NMW) and National Living Wage (NLW). 39% of respondents suggested the new hourly rates – NLW has increased by almost 10% and the NMW rate for under 18s and apprentices has increased by more than 21% - would affect their business, with 11% stating the impact would be ‘significant’. 

The survey provides valuable insights into the challenges family, privately owned and owner-managed businesses face and how they are being impacted. Running November to December 2023, 300 business owners shared their views about the impact of recruitment challenges, how they are adapting to the evolving digital world and how they plan to innovate and grow. They also shared their concerns about the impact of external pressures and the issues that will impact business growth over the next three years.

The Family, Privately Owned, and Owner Managed Business Survey 2023 - marking five years since the previous survey, and the third to be carried out by the firm - found that a third of all businesses find it ‘very difficult to recruit’. This is up 8% from the last survey in 2018, despite 65% making changes to help with recruitment.

On a more positive note, fewer businesses than in 2018 said retention is an issue for them, with 37% taking action to keep staff, including 71% of those increasing salaries above inflation and just under half who have introduced flexible working arrangements.

When it comes to technology, the survey found that 22% of businesses are using AI, while a further 11% are considering it, but more than half don’t believe it is relevant to their business.

Looking ahead, 73% of business owners are somewhat concerned (54%) or very concerned (21%) about inflationary pressures on business costs during the next 12 months, and the impact of increased costs on viability was listed as the biggest challenge to business growth over the next three years, according to 44% of respondents.

The survey also asked business owners about their exit strategies, with the majority (35%) planning to leave their business by passing it on to their children, however, of these, more than a third (36%) have not yet discussed it with them.

Paul Dickson, Armstrong Watson’s Chief Executive and Managing Partner, said: “Our 2023 survey has revealed some critical insights into the current landscape of family owned, privately owned and owner-managed businesses and how challenges over the past five years - the Covid-19 pandemic, labour shortages, supply chain disruptions, inflation and the cost-of-living crisis – have affected businesses.

“The widespread impact of the increase to the National Minimum Wage and National Living Wage – which will see payroll costs increase across the board – is one key challenge businesses face in balancing fair wages with sustainable growth.

“The ongoing struggle with talent acquisition, despite many making changes to aid recruitment, indicates a growing challenge in the labour market but it is positive to see that the data shows businesses are taking proactive steps to retain staff.

“While AI adoption is still in its early stages with some businesses already implementing it and others considering it, it’s clear that digital transformation is on the horizon. However, there is still work to be done and business owners will need to take action to ensure they’re not left behind.

“These findings highlight the resilience, adaptability, and innovative spirit of family owned, privately owned, and owner-managed businesses and also areas in which they might need support. Despite facing numerous challenges, these businesses continue to evolve and adapt, demonstrating their crucial role in our economy."


Thank you to all those who took the time to share their views. All of the insights the survey highlighted can be found in the full report.

View full survey report

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