"Money's Too Tight to Mention" - or is it? 1 August 2012
The recurring theme during the last six months has been cash, or the lack of it.
Most of our clients, whether performing well or struggling in the current economic conditions, have experienced difficulties with existing banking facilities, customers not paying quickly enough and at the same time, meeting ever increasing demands from suppliers for earlier payment.
Despite media commentary, we have found "the banks" very much open for business and willing to assist with requests for additional finance – subject to meeting certain requirements and having confidence in the management team to deliver as outlined.
During the last six months we have assisted a variety of clients in this difficult area in the following ways:
- replaced an overdraft facility of £1m with a Confidential Invoice Discounting ("CID") facility of £7m
- more than doubled the CID facility from £750,000 to £1.75m for another client
- refinanced an existing business and increased facilities by £500,000
- managed a client through the process of "intensive care" with their existing bank and increased banking facilities by 25% through the process
- raised asset finance facilities by c£30m to in excess of £65m
- worked with existing finance providers to increase existing facilities on a temporary basis for four separate clients, three of which have become longer-term "temporary" facilities
Our approach continues as before – ensuring that our clients have strong all-round management teams with a good business model and strategy, backed-up with strong financial management and cash disciplines.
The key feature of our clients remains working with strong operational companies with challenges – both positive and negative, and their Financial Stakeholders. We are usually able to act as the conduit to bring both parties together and produce results that work for both sides.
We remain on the look-out for more challenges and to assisting companies with these issues – we know that there are many around, so please do not hesitate to contact us for an informal confidential discussion.
Thank you to everyone for all of your continued help and support.
Craig and Caroline
Regulated by the Institute of Chartered Accountants of Scotland
for a range of business activities.
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