Cashflow problems … and solutions

 

What’s your response when you’re asked, “How’s business?”. If you’re honest, things probably could be better, especially where consistent cashflow is concerned. This could be due to seasonal factors, volatile input/output prices or other factors specific to your business. We’ve put together a few tips to help you solve or avoid your cashflow challenges.

Invoice Financing
This flexible form of funding releases cash tied up in outstanding customer invoices. The two main types of invoice finance are factoring and invoice discounting. Factoring provides you with a cash injection into the business of up to 90% of the invoice value, giving you full credit control and sales ledger management, by sending relevant, timely letters and statements to customers to help speed up payments. With invoice discounting, the main difference is that you retain control of the sales ledger and credit control activity, but you’re still able to take advantage of cash advances of up to 90% of the invoice value. Typically a confidential service, invoice discounting of this kind can be for domestic or export sales.

Asset Based Lending (ABL)
ABL allows bigger businesses to raise the higher levels of funding they need. It is ideally suited to Management Buy Out (MBO) or Management Buy In (MBI) situations as well as for releasing additional working capital, for use in growth or turnaround profiles. Receivables, stock and property are the assets typically leveraged through ABL.

Bridging Finance
Bridging finance does exactly what it says on the tin – it bridges the gap until longer-term financing is secured. In this situation, funders provide a fast, flexible and transparent short-term finance that will support the business through this gap. It is often used in the property market but bridging facilities are also available for trading businesses where there is a short-term working capital requirement, which can be secured against existing assets or positive cash flow.

Trade Finance
Another option is trade finance which can provide a business with upfront funding against confirmed orders, open letters of credit facilities on behalf of the business and provide direct supplier payments or even a cash advance. It suits businesses who have confirmed purchase orders or supply contracts from reliable sources.

 

As one of the leading financial service providers in the Irish market, GRENKE’s slogan is ‘Fast, Forward, Finance’. GRENKE offers entrepreneurs fast and flexible financial solutions through a range of services including leasing and invoice finance. We match the perfect financial solution to your unique business needs, from small businesses to large enterprises. 

Over the last 40 years, GRENKE has provided leasing to numerous styles of businesses and organisations; sole traders, partnerships, public and private limited companies, associations and organisations, medical, health, and educational providers, municipalities, public hospitals, semi-state institutions, Government bodies and so many more.  

Our experiance and strong market position are no coincidence. If you are a business owner looking for financial solutions in Ireland or advice on fast and flexible financing, talk to a GRENKE Account Manager today!