In 2017 we conducted a survey, asking 500 financial decision makers their views and their plans and fears for their business in the year ahead. The results showed
that almost half of SMEs admitted that they could not last any longer than a month on their existing cash reserves and for many, it was far less. According to BDRC SME Finance Monitor only 24% of SMEs have a dedicated finance person. Supporting business leaders is our top priority and in this guide we share our expertise, to help manage your finances more effectively.
We understand how stressful running a business is – and how easy it is to put off or feel like you don’t have time for planning – but we want to reiterate that financial planning is not something that should be compromised on. Most senior team members in small or medium sized businesses wear ‘many hats’ and end up juggling priorities – with those demands that feel most immediate, but perhaps being smaller, usually taking priority. This means that more serious decisions are not given the time they need for proper consideration.
This guide will help you to kick-start the process of allowing more time for financial planning and financial decisions, including whether to employ the use of external business finance – for growth, to bridge a cash flow gap or to turn your situation around.
There still exists a stigma surrounding the use of external finance, as if to rely on anything but self-generated cash is somehow a sign that your business is struggling. In fact, recognising where borrowing can be a strategic advantage, is a smart way to ensure that you can get ahead and achieve your goals. If your business experiences cash flow peaks and troughs, by recognizing that fact you can minimise the impact it has on your business operations, planning and sales. If you do hit trouble or external events hit your cash flow pressure points hard, you are always going to be in a much stronger position having prepped and researched the options available to you. The more time you allow when seeking finance, the more the decision-making power is yours.
Our data also indicated that the top concern when seeking finance is the price. This is at odds with the lack of planning as any reactive, last minute search will mean you can’t negotiate or use the best-priced products. Time is at a premium and if you want finance immediately you need to be prepared to pay more for it.
In this guide, you will find practical tips and questions to analyse your position and help you to prepare, establish if you need to use business finance and effectively plan using the timeline provided to follow to keep you on track.