The single biggest problem facing small to medium sized businesses (SME’s) today is, CASH FLOW. It is also the main reason for Business failure. The reasons are many:
- The business is under capitalised, without sufficient working capital. This could be an historic problem, or one caused by growth or over trading.
- Overdue or bad debts.
- Over stocking or obsolete stock.
- Over financing or over investment.
- Pressure on sales and margins due to market conditions or competition.
- Income & Expenditure balance is negative.
- Banks reducing or withdrawing facilities, or demanding more security.
- Credit insurance on your business has been withdrawn and your suppliers are insisting on pro-forma payments.
- Aggressive creditors (Suppliers, Banks, and Revenue) are demanding payment. Legal action has started-CCJs, Statutory Demand