Business & Cash Flow Loans
Solve Your Business Cash Flow Problems
When looking to access finance we always recommend that you first consider working capital management, which is the amount of capital easily available to the business – essentially it's the difference between the assets that you currently have, and your debts or liabilities. Because bills are paid in cash and not in profit, it's imperative that funds are held as monies in the bank for as long as possible to earn the optimum interest, however, it may be more appropriate for these funds to be invested in other assets or used to clear liabilities.
Analysing Business Cash Flow
We can assist you with ratio analysis, which monitors overall trends in working capital and helps to identify areas which you may need to manage closer, as well as individual components of working capital.
Our Cash Flow Products and Management Will Help Improve Your Business
There are a variety of ways in which we can help you improve your working capital management. Just consider the following questions:
- Stock – do you have too much or too little, is stock managed properly, do you have appropriate records, and are you carrying unnecessary costs?
- Debtors/Receivables – are your customers paying you late and is this delaying your ability to spend in other areas, can you set up strategies to encourage early payment or impose penalties for late payment, and could outsourcing the sales ledger function to factors or invoice discounters release the funds that you need, to avoid having to secure additional loans?
- Creditors/Payables – can you minimise creditor costs with simple procedures, is it really worthwhile to delay all payments until the last possible moment or could you access discounts with a payment strategy, do you always pay by cheque and could it be cheaper to make direct credits electronically?
- Terms and Conditions of Trade – are your terms set to maximise the benefit to you whilst reducing the risk, can you negotiate harder with suppliers to secure volume discounts or extended credit, and does this fit a longer-term strategy?
- Margins and Internal Controls – is your conversion rate from lead to sale high enough, are you processing enough transactions, and are your margins adequate?
- Forecasting – do you buy what you need as you need it, or do you run a detailed forecast to schedule purchases at periods of optimum cash flow? If you do run forecasts are they accurate and can you rely on them, or do only certain areas of your business feed into them?
If you already have good working capital, and are looking for a more significant sum to allow you to grow your business, why not consider venture capital or business angels? Venture capital sees money invested with you in return for a share of the business, and can take a variety of forms from 100% equity to a mixture of equity and loans. Business angels are normally high-wealth individuals who invest in companies as part of their financial portfolio – think Dragon's Den. There are also a range of corporate venturing and private equity options open to you, and our team can advise which is most suitable. Contact us now to find out more.
Enterprise Loan Guarantee Scheme
For small firms, the Government-backed Enterprise Loan Guarantee Scheme enables high street banks to lend money to companies who wouldn't usually meet their criteria. Covering loans of up to £100,000 for businesses trading less than two years, or up to £250,000 for those trading more than two years, this scheme is open to UK companies with a turnover of no more than £3 million. The loan itself must be used solely for business purposes and we'd be happy to arrange an initial, informal discussion to see if you are eligible – just contact us to make an appointment.
