Nearly half of them (47 percent) fear the next 12 months could prove even more difficult.
Other obstacles identified include managing their own mental health and uncertainty over Anglo-international relations.
And three in five (62 percent) small business owners have suffered from sleepless nights due to worrying about their business.
More than one in 10 (12 percent) think there is a strong possibility that they will go out of business within the next 12 months.
This is despite 44 percent working weekends, 36 percent going six months or more without a holiday and a third working seven-day weeks on a regular basis.
But one sixth of SME owners are hoping the Platinum Jubilee extended Bank Holiday will provide a much-needed boost in profits, and a third are waiting for Christmas to increase their sales.
Ben Ramsden, head of SMEs at PayPal UK, which carried out the study, said: “Financial woes and stress can have a negative impact on health and wellness.
“In tough times, staying on top of their finance wellness is a vital tool for small business owners.
“It needs to be a priority to minimise the personal impact of running a business, which can be an isolating and challenging experience for entrepreneurs.”
Given the current challenges, three in five admit to finding running their business stressful.
Furthermore, a quarter ignore the financial health of their business, worried about what the true picture is.
However, encouragingly SMEs are trying to take more control of their financial wellness by upskilling themselves by using finance apps (31 percent) and learning from past mistakes (53 percent).
As a result, 56 percent feel more financially savvy following the uncertainty of the global pandemic.
Over a quarter (27 percent) feel back in control of their own business after experiencing such uncertainty and one in five (21 percent) feel more empowered as a business owner since improving their knowledge of their business’ finances.
And having a financially healthy business will start to create new opportunities for small business owners, according to the research, by OnePoll.
This includes having more self-confidence as a leader (45 percent), having savings for the future (42 percent) and experiencing less stress (39 percent).
Ben added: “We have launched a number of solutions and PayPal’s Business of Change: Wellbeing & Empowerment report, to arm business owners with practical advice for managing their financial wellbeing and to help set themselves up for success in 2022.”
Sandy Ruddock, small business owner and co-Founder of Scarlett & Mustard said: “Our biggest challenge has been the rising cost of raw materials but we’re reluctant to raise our prices to avoid impacting our customers – it’s a lot of pressure to deal with.
“Since relaunching our website last year however, our sales have increased with 80 percent now being made online solely via PayPal.
“It has really helped to ease some of the associated stress and I’d certainly recommend other small business owners who are feeling the strain to invest in their social media presence to drive online growth further.”
To get practical advice on how to manage business finances visit – https://www.paypal.com/uk/brc/topics/build-business-resilience.