We recently surveyed our customers on their growth prospects given the headwinds in the economy. For many, now is a time of introspection—a time to consider cash flow, revenue and delivery models.
The increase in interest rates, minimum wage, and the additional holidays happening this year will also impact cash flow. Some may view this as a time to hunker down, limit spending, accept lower returns. Our experience over the years has been that times like this are when entrepreneurs thrive - provided you take calculated risks.
The saying “summer bodies are made in winter months” applies to cash flow and business growth. Now is the time to perform the SWOT analysis, perform the restructure to growth, introduce the new services that add revenue or, better yet, stage a successful exit via MBO and let new talent thrive.
In all cases, creating and executing a plan to achieve your business objectives is critical.
In Cameron Bagrie’s recent excellent analysis on the impact of the CCCFA
Working capital and liquidity will be key over coming months. Want better access to working capital? Then being a better bankable business is a major step.
The only point we take issue with is “bankable”. There are limits to what bank managers can do, and often banks ask for unreasonable securities and personal guarantees.
We would say, “want better access to working capital? Focus on speeding up your cash flow”. Without cash flow, plans become wish lists - as the reality of meeting payroll, tax payments and supplier payment terms takes over. Here are three things any business can do now to ensure better cash flow:
Together, these tactics will provide your business with steady cash flow to give you the flexibility to manoeuvre. Remember, luck is when opportunity meets planning. So plan to be lucky.
Other helpful links: