31% of Hampshire and IoW firms have had their cashflow squeezed by more late paying customers and 22% have been given reduced payment timescales from more suppliers, in the past six months, according to Business Link’s Report Credit and Cash flow in the Recession.
Banks and lenders are also changing their conditions. Of those firms in HIOW which tried to seek new finance, renew or extend credit terms, 28% had difficulty doing so.
The Report compares the common sources of finance being used now with the popular sources of finance used in December 2006. The research found that of those HIOW business owners and senior managers surveyed:
• 41% are now using their bank overdraft, compared with 43% in December 2006.
• 18% of businesses are leasing or using hire purchase up from 14% previously.
Business Link director Deborah Wyatt commented: “Adequate cash flow is the life blood of a business, and we know how difficult it can be to manage.”
Her tips are:
• Understand how the cashflow in your business fluctuates daily through the month. Try to establish the patterns for cashflow and find opportunities where you can match your billing and payment schedules to avoid paying overdraft fees.
• If you need external finance, speak to a Business Link Adviser. They can identify the best source of finance. It’s amazing how much has changed in the lending market over the past 12 months, and we can help to demystify the jargon, and help to outline your options.
Andy Burton, Drive Personnel said: “We used the opportunity of a meeting with our Business Link adviser, Nigel Smith, to reflect upon how we were managing our cashflow and to identify other assistance available to us. The discussion enabled us to make some worthwhile changes to our way of working.”
Business Link provides information, advice and referrals to sources of funding, other business support and professional services such as accountants. To find out how they can help you, or to book a free business review Health Check, call Business Link on 0845-600-9006, or go to http://www.businesslink.gov.uk/southeast