Invoice Factoring Could Help Survival in this Recession
Its official the British Nation is now in financial recession and businesses need to have a robust map to navigate this economic downturn or they are destined to go bankrupt.
The challenging trading conditions over the Christmas and New Years holiday season saw a record level of shops go bust
Stores and Companies to be effected by the economic downturn 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.
One of the most well know victims of the recession is Woolworths that went into liquidation just before Christmas. Its final shops closed on January the 5th, resulting in 27,000 staff loosing their jobs.
A business owner should be thinking how can I survive this economic slump? The Turnaround Management Association says that for a business to achieve a successful turnaround it needs four things; a credible management team, a viable business core, a valid business plan and appropriate funding.
The credit crunch and lack of liquidity within the financial money markets has restricted traditional forms of lending from Banks into Businesses to very dangerous levels. This limitation of funding has implemented a Cash Flow Squeeze on British Business.
Company Directors with an eye on survival should immediately have a plan to reduce expenditure within the business. Carefully review expenditure to identify any areas of your business where savings can be made. Meticulously going over the Companies expense to find areas where costs can be cut. You should look at Telephone Charges and Tariffs, Utilities, Trade Suppliers, transport costs. The accumulation of a number of cost saving can be remarkable.
Business owners interested in surviving a recession should look for alternative and appropriate sources of finance. The old clich of cash is king has never been more important than at the present time, although most businesses nowadays rely on some form of third party funding whether it be bank overdraft or business loans. Now may be the time to consider alternative sources of funding such as invoice factoring, which is increasingly popular for small to medium businesses. While not suitable for all businesses, 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 finance 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.
The challenging trading conditions over the Christmas and New Years holiday season saw a record level of shops go bust
Stores and Companies to be effected by the economic downturn 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.
One of the most well know victims of the recession is Woolworths that went into liquidation just before Christmas. Its final shops closed on January the 5th, resulting in 27,000 staff loosing their jobs.
A business owner should be thinking how can I survive this economic slump? The Turnaround Management Association says that for a business to achieve a successful turnaround it needs four things; a credible management team, a viable business core, a valid business plan and appropriate funding.
The credit crunch and lack of liquidity within the financial money markets has restricted traditional forms of lending from Banks into Businesses to very dangerous levels. This limitation of funding has implemented a Cash Flow Squeeze on British Business.
Company Directors with an eye on survival should immediately have a plan to reduce expenditure within the business. Carefully review expenditure to identify any areas of your business where savings can be made. Meticulously going over the Companies expense to find areas where costs can be cut. You should look at Telephone Charges and Tariffs, Utilities, Trade Suppliers, transport costs. The accumulation of a number of cost saving can be remarkable.
Business owners interested in surviving a recession should look for alternative and appropriate sources of finance. The old clich of cash is king has never been more important than at the present time, although most businesses nowadays rely on some form of third party funding whether it be bank overdraft or business loans. Now may be the time to consider alternative sources of funding such as invoice factoring, which is increasingly popular for small to medium businesses. While not suitable for all businesses, 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 finance 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.
About the Author:
Debt Factoring is provided by the Asset Based Finance team of Enable Finance Ltd. Enable Finance are specialist small business finance brokers providing British business access to traditional and different types of credit. For a free meeting please contact the Business Refinance Team.
posted by Debt Consolidation Loan at
5:07 AM
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