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.
The challenging trading conditions over the Christmas and New Years holiday season saw an exceptional level of shops go into insolvency
Retailers and Businesses that have already been bore the brunt of the recession and have had to go bankrupt are MFI the furniture retailer, Whittard of Chelsea, the specialist tea and coffee retailer. and Savvi the music retailer formerly Virgin Megastore.
Possible one of the most high profile causalities of the economic collapse has been woolworths that went into administration 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.
Traditional sources of finance have been restricted to very low levels due to the Credit Crunch and lack of liquidity within the money markets. This constriction of lending has brought about a Cash Flow squeeze on UK plc.
As an economy enters into recession one of the first thing a business should start consistently doing is keeping a tight rain upon costs. A firm hand upon expenses can save a business. Look at shipping costs, promotion and marketing, business premises and even the smallest things such as turning off the office heating at the end of the working day.
Cash Flow within a business is vital at any time but even more so in a recession and having access to working capital should be at the top of any business owners list. Funding a business with 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 poor payers or they go into insolvency.
The challenging trading conditions over the Christmas and New Years holiday season saw an exceptional level of shops go into insolvency
Retailers and Businesses that have already been bore the brunt of the recession and have had to go bankrupt are MFI the furniture retailer, Whittard of Chelsea, the specialist tea and coffee retailer. and Savvi the music retailer formerly Virgin Megastore.
Possible one of the most high profile causalities of the economic collapse has been woolworths that went into administration 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.
Traditional sources of finance have been restricted to very low levels due to the Credit Crunch and lack of liquidity within the money markets. This constriction of lending has brought about a Cash Flow squeeze on UK plc.
As an economy enters into recession one of the first thing a business should start consistently doing is keeping a tight rain upon costs. A firm hand upon expenses can save a business. Look at shipping costs, promotion and marketing, business premises and even the smallest things such as turning off the office heating at the end of the working day.
Cash Flow within a business is vital at any time but even more so in a recession and having access to working capital should be at the top of any business owners list. Funding a business with 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 poor payers or they go into insolvency.
About the Author:
Debt Factoring is provided by the Asset Based Lending team of Enable Finance Ltd. Enable Finance are specialist corporate finance company providing UK business access to traditional and different types of credit. For a free meeting please contact the Business Refinance Team.
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