News & Articles

What’s around the corner - cash-flow tips to help plan ahead

Client Support
Dan Garside
14/05/2020
Click to share to a social media platform.

As many businesses come to grips with either operating at much reduced capacity or even mothballing operations entirely, now is the time to consider what issues might be coming up around the corner.

In our recent Access to Finance webinar we highlighted some of the points that firms need to factor into their short term planning strategies and models. To recap, we have detailed below the top 5 key areas for you to consider:


Invoice discounting funding issues


Most agreements of this kind will have recourse arrangements (i.e. remove the ability to finance certain invoices) if they remain unpaid after 90-120 days. We would urge you to therefore check your position in this regards and consider the impact his may have on your ability to borrow against your debtor book, as cash shortfalls may occur and additional financial support (potentially via CBILS) may be required. It is worth noting that a number of the invoice finance funders are also now accredited and able to offer CBILS loans alongside an invoice finance solution.



Working capital erosion


It is good to hear that many businesses are presently managing through these difficult times, but please be careful to consider the impact this is having on working capital reserves. They are likely to be severely impacted and may require replenishing via borrowing such as CBIL or the BBL schemes . Planning for re-opening should factor in your working capital needs, let us know if you need help understanding this.



Early CBIL applicants


You should consider whether you should refinance debt via the new Bounce Back Loan scheme as this may potentially provide cheaper borrowing or an ability to move the security over to the 100% backed scheme.



Creditor pressure


As the court system comes back into full swing, so creditor pressure might start to increase as businesses look to keep themselves liquid. Managing creditor expectations remains important and transparent communication key to gaining agreement for individual time-to-pay arrangements. If creditor pressure turns into court applications and CCJ’s, businesses could look to protect themselves by using Creditor Voluntary Arrangements.



Cash flow modelling


No doubt that is it is very difficult to predict what the true trajectory for any industry is as we return to trading, but having the ability to quickly flex your cash flow modelling will be invaluable. We would urge you to start this planning now -  something we can help with given the software and tools we have at our disposal.


As ever, we are here to support our clients through these challenging times and are closely monitoring the situation so we can best advise our clients. If your business is in need of financial assistance then please do liaise with your regular Rickard Luckin contact who will be able to help and advice on the most appropriate route to raising finance.

Related View All

Access to finance
24/03/2020
Client Support
Dan Garside

Access to finance

Covid-19 and thinking outside the box – Opportunities for your business
31/03/2020
Client Support
Mark Brooks

Covid-19 and thinking outside the box – Opportunities for your business

New ‘Bounce Back Loan’ announced
28/04/2020
Client Support
Mark Brooks

New ‘Bounce Back Loan’ announced

VAT Payments – Holiday over?
21/05/2020
Client Support
Ian Marrow

VAT Payments – Holiday over?

Our Accreditations and Memberships