Invoice Factoring Could Help Survival in this Recession
There is no avoiding the issue the UK Economy is in recession and if you are a business owner you must have a plan to survive this economic slump or you will most certainly fail.
Tough trading over Christmas and the New Year period has seen an unprecedented number of high street retails go into administration or liquidation.
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.
Possible one of the most high profile causalities of the economic collapse has been woolworths that went into liquidation in December 2007 and finally closed all retail outlets in January which has put 27,000 out of work.
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.
British Business is now facing a Cash Flow restriction caused by the credit crunch and and freeze in the capital markets forcing Companies to search out alternative sources of funding
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.
Cash is King and Company Directors looking to avoid the pain caused by an economic downturn should seek out alternative sources of funding such as debt 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 finance 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 working capital if customers are poor payers or they go into administration.
Tough trading over Christmas and the New Year period has seen an unprecedented number of high street retails go into administration or liquidation.
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.
Possible one of the most high profile causalities of the economic collapse has been woolworths that went into liquidation in December 2007 and finally closed all retail outlets in January which has put 27,000 out of work.
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.
British Business is now facing a Cash Flow restriction caused by the credit crunch and and freeze in the capital markets forcing Companies to search out alternative sources of funding
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.
Cash is King and Company Directors looking to avoid the pain caused by an economic downturn should seek out alternative sources of funding such as debt 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 finance 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 working capital if customers are poor payers or they go into administration.
About the Author:
Debt Factoring is provided by the Asset Based Lending team of Enable Finance Ltd. Enable Finance are professional small business finance brokers providing UK 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
11:36 AM
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