News and Info
Cash Falling With The Snow?
2010Many business’ good intentions to make a vigorous start to the new year have been blown off course by the arctic conditions that have enveloped the country in this first week of 2010.
Research in previous cold spells suggests that productivity and trade, whilst temporarily disrupted, is not seriously affected in the long term. The old adage “Cash is King” reflects the importance of cash flow to all business’ and that remains in the current freezing conditions. Serious interruption to cash flow will threaten the survival of many business’ particularly those in the retail, hospitality and transport sectors. All business’ carry fixed costs and many of those cannot be defrayed.
There is no doubt that developments in mobile communications over the last 20 years have made business’ more adaptable in these conditions. At e-Financial Management we can easily keep in touch with clients and colleagues and address specific issues and ongoing workloads on an almost business as usual basis. So how can business’ address the cashflow issues:
1. Invoice as normal, even if this means remotely e mailing invoices, this can be followed up by putting a hard copy in the post when conditions improve. Delaying invoicing may cause a problem in the months to come.
2. Get customers to transfer outstanding funds electronically, thus avoiding the cheque in the post syndrome
3. If operating a skeleton staff ensure that someone has responsibility for banking cheques as normal
4. Revise your cash flow forecasts to reflect the current situation, the standing orders and direct debits will be charged whatever the weather.
5. If having cash flow problems speak to the bank, HMRC and significant creditors explain the situation, you won’t be the only one, “don’t bury your head in the sand”.
In the cold snap last year it was estimated that over 2000 business went out of business, make sure that you survive again. Back to News