Without cash, even the most successful business will struggle.
Is your business cash hungry?
Do you need to get your cash flow flowing?
Your business may be in a rapid growth phase
If so you are experiencing rapid growth and selling on credit. The more you grow, the greater the sum tied up in accounts receivable will become. This puts a strain on your working capital resources. This will often be compounded by the need to hire more staff or commit to other extra overheads and one-off expenses due to the increased activity generated by the growth.
Is your business restructuring?
Maybe you are restructuring your activities. Perhaps you have to reduce your workforce, sell assets or make other changes in your business. Whenever a business has to do something like this, the increased income or reduced costs or increased available working capital will take a while to materialise. If you are already under some cash flow pressure, problems could occur before the benefits of the restructuring are seen.
Are you ever meet with unforeseen problems?
It happens. A bad debt. A key customer changes suppliers. A production problem. The list goes on. We all know businesses experience all sorts of problems. If the problem affects cash flow temporarily, working capital may come under pressure.
Your business may want to take on an opportunity.
You have an opportunity. You can get some stock at a discount, or buy out a competitor. Whatever the opportunity, you may need extra cash short term to take advantage of the opportunity.
One or more of these situations could be where your business is right now.
Or you may be impacted by the seasonal ebb and flow, and the highs and lows can hit at different times. Christmas is often a case in point. Typically, businesses are either flat tack or on go slow over the summer holiday period, and it’s these fluctuations that play havoc with business finances. A sound business can suddenly find itself short on funds.
Fortunately, there are options to solve these cash flow challenges.
Depending on your business, one option may suit better than another.
A bank overdraft facility could be best. A structured bank loan may be the perfect stopgap.
But what if the banks say “No”?
Then asset finance may be just what you need.
Invoice finance is another option. In this instance, the funder advances money that you’ve invoiced for but have yet to receive. This form of finance has a bonus attached. Unlike with other alternative solutions, it will not add to your legacy of debt and will not sacrifice equity.
So think ahead. Do your due diligence and find a cash flow solution that fits your business. Even better, have a facility set up and ready to go before you need it.
It makes good business sense.
