TURNOVER “falling off a cliff” is the biggest fear of small firms in the North West.

At 31%, it topped a list of the three biggest threats perceived by the small firms sector in a poll by the Institute of Chartered Accountants in England and Wales (ICAEW).

It was followed by coping with the consequences of a significant bad debt (21%) and margins coming under pressure (9%).

In addition, the three most important things, apart from the usual sales costs and profit, which the firms felt needed measuring were available cash (19%), return from each job (17%), and the number of customers or clients who buy again (11%).

ICAEW head of small and medium-sized enterprises issues, Clive Lewis, said: “Feedback from our members suggests businesses are focusing on cashflow and closely monitoring the ‘headroom’ available in current finance facilities.

“Many have also tightened up their credit management procedures.

“Bad debts not only represent a loss to the business, but they frighten finance providers who are rightly concerned about the realisable value of the business’s assets.”

He also advised firms, despite the cost, to err on the side of caution and retain an element of unused finance facilities.