- 28 Nov
Help Funding Christmas Cash Flow Problems
Hard to believe its only November and we are already planning for Christmas, however there are good reasons to plan ahead at this time of year. The cash flow of your business can be particularly affected by the seasonal effects of Christmas.
For example, staff expect to receive their monthly wages early, before the Xmas break - and in some cases there will also be Christmas bonuses due to be paid. At the same time, seasonal staff absences at your customers companies can mean that debtor payments are delayed, creating a cash flow problem. Whilst December may be busy for some businesses, in many sectors, December can be a quiet month, due to the number of public holidays, leading to a drop off in revenue, adding to the cash flow headache.
There are a few actions that you can take to help solve your cash flow problems, and we set these out in our article: 6 Ways To Solve Seasonal Cash Flow Problems.
Invoice Finance To Improve Christmas Cash Flow
One way of improving your Christmas cash flow is to use an invoice finance facility. This type of finance short cuts the time you wait to get paid by customers by giving you the majority of the value of your sales invoices upfront, immediately you raise them. You still get the balance (less the charge for the service) when the customers pay.
We can have a facility in place within a few days, so there is still time to make arrangements before the Xmas holiday period.
There are different types of invoice finance which you can learn about in our free guide to receivables financing. However, there are two principle variations that are worth mentioning here.
Selective Invoice Finance (SIF)
One type is what we call selective invoice finance. You can choose some outstanding sales invoices and release (normally 85% upfront) against them - the balance, less the fee is passed to you when your customer pays. The advantage of SIF is that you have no obligation to ever use the facility ever again. In that way, you could use it to get you over the Christmas cash flow hump, without being tied in to use it again.
Revolving Invoice Finance (RIF)
The other option is revolving invoice finance, whereby you enter into an ongoing arrangement to receive finance against all (or at least the bulk of) your invoices. This is more suitable if you have ongoing cash flow pressures that could be alleviated by receiving, normally 85%, upfront against all your unpaid sales invoices. This can smooth your cash flow on an ongoing basis, and give you working capital for other uses e.g. growth or expansion.
Either option can be used to help smooth out your Christmas cash flow, we are always happy to discuss exactly what you require, just call us on 03330 113622..
- 03 Dec
UK Ombudsman Proposals For Banking And Finance Complaints
UK Finance, the trade association for the UK banking and finance industry, which was formed on the 1st of July 2017, has announced proposals to increase SMEs access to independent ombudsman services.Any SMEs with invoice finance related complaints should see our advice regarding invoice finance complaints.SMEs could soon have banking and finance disputes resolved, and dealt with, via a binding...
- 29 Nov
DIY Debt Collection - How To Collect An Unpaid Debt
We are sometimes asked for help collecting overdue debts. If there are numerous debts or if they are substantial enough there are providers that will handle the case for you, however when the debt is smaller, maybe just a few thousand pounds, although important to you, you may also find that it is often not large enough to warrant getting professional debt collectors, or perhaps even solicitors...
- 24 Oct
Car Repair Invoice Discounting For All Sizes
We have had a lot of success helping finance car crash repairers. We have assisted the full range of sizes from small companies to multi-million pound turnover companies. There are no minimum turnover restrictions on these types of facilities so even the smallest businesses can use this type of invoice discounting without the need to worry about minimum fees, or reaching minimum levels of...
- 23 Oct
New Asset Based Lending Funding Company
One of the most important features of the business finance search service that we offer is that we are continually adding new funding companies to our panel of funding partners. There are almost 100 different invoice finance companies operating in the UK at present.We do this to make sure that we can provide not only the cheapest invoice finance prices, but also the most flexible funding options...
- 22 Oct
Recruitment Outsourcing Without Issues
I posted the other day about the issues that can be associated with some of the recruitment outsourcing companies who also provide funding. Interestingly, we have just had a conversation with a new outsourcing invoice finance company that are able to provide the full range of services from funding, to payroll management to accounting services.Being able to access this kind of package of services...
- 19 Oct
Recruitment Acquisition Finance
We are looking at a prospect that is seeking recruitment acquisition finance for a business that they are seeking to purchase. I highlight this as a reminder of how invoice finance can be used to fund company acquisitions.In this case it is a recruitment sector company, however the same approach can be applied to any sector.There are two possible ways in which you can structure this type of...