Cashflow and Profitability

In the current challenging economic climate, it is not sufficient for businesses to be profitable, but essential for the business to create and plan for sufficient cashflow to fund its operations.

Most businesses have found it harder to collect money owed by customers, whilst at the same time their suppliers are pushing to be paid quicker. Furthermore banks are far less willing to fill the cashflow gap.

As the phrase goes ‘Hope is not a Strategy’ – more than ever it is essential to plan ahead.

We have many years experience and success in helping clients assess and analyse their profitability and cash flow.

Our services fall into the following broad areas:

Profitability analysis – this we do regularly when discussing accounts with clients, but we can also go some steps further and analyse specific areas of business activity and expenses, for a deeper understanding of how to increase profitability. We use software by Quad which enables accounting data to be stretched or contracted to determine the likely result of adopting a particular business strategy.

For an introduction to Quad Business Builder, download the presentation available in 2 formats:

• Quad Business Builder - Powerpoint format Download PowerPoint viewer here.
• Quad Business Builder - PDF format Download Adobe PDF reader here.

Cashflow forecasting – we have the experience and software to analyse the finances of a business, and prepare both profit and cashflow forecasts. These forecasts help business owners and managers to project the businesses’s financial needs, and take steps to ensure the smooth running of the business in the future.

If the forecasts indicate that there will be a shortfall at a particular stage, steps can be taken well in advance to remedy the situation. Crisis management is avoided!

Our forecasts are in a format that can be readily incorporated into a business plan for presentation to banks and other potential finance providers.

The Small Firms Loan Guarantee Scheme is Government backed and designed to help businesses raise anything up to £250,000. It’s potentially an excellent scheme for companies looking for a reliable cash injection. We have experience of helping clients apply for finance under this scheme and in producing the forecasts that demonstrate the financial requirements of the business.

Other areas of funding – bank finance is not the only source of meeting the funding requirements, and often is not the option to go for. We advise on the various options, the costs, advantages and disadvantages. We will advise on raising finance via factoring, invoice discounting, leasing and asset finance, venture capital and private investors, grants and funds from specific sources (i.e. Rosebud Fund to name one such source). Our aim is to best match the funding with the particular business requirement.

Please call us if you would like advice on any of the matters raised above.