Cranfield Business Recovery, Coventry, West Midlands, UK

Where can I find cash?

12th February 2009 15:39

This is probably the most common question that I am getting asked at the moment, as businesses are struggling to come to terms with the effects of the growing recession. In reality, it is very difficult to obtain funding in the current financial market unless you meet the stringent lending criteria of the Banks or you are prepared to give a personal guarantee!

I’ve also heard from several company directors where their bankers have unexpectedly withdrawn or not renewed their banking facilities, leaving the company with severe cash flow difficulties. So what can you do?

The old adage of “Cash is King” has never been more pertinent than in the current climate and prevention is better than the cure.

• If your bank facilities are coming up for renewal, speak to the bank early to gauge whether they are proposing or willing to renew the ongoing facilities. It is going to be very difficult to move to an alternative banker.
• Prepare a cash flow forecast so that you are aware of what your immediate short term cash requirements are.
• Review your credit control process. Are your debtor days being extended? Have any of your customers exceeded their credit limit? Is your cash collection working effectively?

• Analyse your areas of expenditure and see whether any cost savings could be made. Are all your forthcoming purchases vital to the ongoing trade of the company or can they be deferred.

If the company is still projecting a deficit in the cash flow forecast, I would always recommend getting early advice from a professional such as an Insolvency Practitioner. There are several solutions that we are able to offer which will enable the company to restructure their debt and allow the business to continue.

If you would like a free meeting to discuss your options then please do not hesitate to contact me.

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