Your Great Finance

Its now a blatant fact that the United Kingdom Economy is in decline and Company Directors interested in their Companies existence must have a plan or they will most certainly go into administration

A record number of companies and shops went into insolvency over the Christmas period caused by the really awful trading conditions.

Stores and Companies to be effected by the recession are Savvi the music retailer formerly Virgin Megastore, Adams the Independent childrens clothes retailer, USC the Fashion store and Whittard of Chelsea, the specialist tea and coffee retailer.

Another victim of the recession has been our beloved Woolworths that went into administration just before Christmas and saw its final stores close on the 5th of January 2009, which has left 27,000 people facing redundancy.

How can a business survive this recession? Well Alan Tilley of the Turnaround Management Association says that for a business to achieve a successful turnaround it needs four things; a viable business core, credible management team, a valid business plan and appropriate finance.

British Business is now facing a Cash Flow pinch caused by the credit crunch and and freeze in the capital markets forcing Companies to search out alternative sources of funding

As an economy enters into recession one of the first thing a business should start consistently doing is keeping a tight rain upon costs. A firm hand upon expenses can save a business. Look at shipping costs, promotion and marketing, business premises and even the simplest things such as turning off the office heating at the end of the working day.

Cash Flow within a business is vital at any time but even more so in a recession and having access to working capital should be at the top of any business owners list. Funding a business with invoice factoring, which is increasingly popular for small to medium businesses. While not suitable for all Companies, the huge benefit of invoice factoring is that rather than have money tied up in invoices that are yet to be paid, you can receive an initial payment up front, typically 80% – 85% of the gross value, and the remainder when the customer pays the invoices to an invoice factoring provider, less the service fee which has been negotiated with them. However, if the customer defaults on payment, then the factoring company will recover the money provided to you initially from any further invoices which are factored. This can lead to unpredictable cash flow if customers are slow payers or they go into insolvency.

Enable Finance Ltd. are specialist providers of corporate business finance, helping business with dynamic and appropriate business advice to speak with one of our business advisor’s about alternative sources of funding such as Invoice Factoring please feel free to contact our website and arrange a FREE consultation.

Be Sociable, Share!

•