Cash Flow Problems

Cash flow is one of those areas that pretty much every business will have issues with from to time. In fact, we’d be surprised if there’s a company out there who could claim to have never had cash flow problems.

Understanding how they happen, how they can be looked at, and how overcoming cash flow problems works, helps immensely to improve the long-term life of a company.

At Hillcrest Finance, we help customers who come to us for help with cash flow. In this short guide, we want to highlight how it comes to be and what solutions you would expect to hear from business advisors like ourselves.

It’s just a brief overview, and if you have a specific question regarding cash flow, get in touch right now, and we’ll see how we can help.

What cash flow problems a business might experience?

Common cash flow problems for businesses in the UK would include:

  • Lack of cash on hand/reserved
  • Quick accumulation of debts
  • Overheads are higher than initially thought
  • Clients/customers not paying invoices on time
  • Bad debt
  • Falling behind on payments, especially tax for HMRC

These are just some of the most notable. Most businesses will have specific cash flow issues unique to their situation, and that typically requires someone like ourselves to come on board and provide assistance.

How can businesses improve cash flow?

If it was as simple as going to the bank and asking for money, everyone would immediately solve their cash problems while simultaneously creating new ones. How your business tackles these issues will depend on a number of factors like the size of your business and the industry you operate in.

Typically, improving cash flow starts with a full audit of finances, especially if cash flow problems are more of a regular occurrence than a surprise. An advisor or accountant will want to cast a keen eye over finances to see where immediate and long-term solutions lie. They will never enact changes, but will simply showcase where those opportunities lie.

What cash flow solutions would an advisor provide?

Again, we can’t get into specifics here as recommendations vary wildly from industry to industry, but common cash solutions would include:

  • Opting for new contracts from suppliers
  • Bringing operational costs down (e.g. moving office, changing service providers)
  • Capping staff costs on things like overtime
  • Uncovering current products or services which could be used in a complementary fashion to boost revenue quickly

Expert advice can also help uncover seasonality around cash flow and whether your business needs to have a plan in which it knows well in advance to handle these dips in revenue.

Why would a business want to get their cash flow examined?

For businesses where cash flow problems are a small blip on the calendar, it helps to have an advisor look over things even to see if there are cash flow problems a business might experience in the future.

For businesses where there have been a few instances of cash flow problems, you’ll want everything looked at to avoid long-term headaches and credit affected. In rare cases, business cash flow problems can lead to insolvency, something no one wants.

Can a business with cash flow problems raise finance?

Yes. Hillcrest Finance has helped many customers raise business finance to help alleviate strain with cash flow. You can find out more about how our team handles this here.

Want to discuss how your business could overcome cash flow problems? Talk to Hillcrest Finance right now.

Call our advisors right on 0141 478 0862 if you’d like to discuss corporate debt solutions. You can also get in touch via our contact page.

Get in touch with us about your Cash Flow Problems