Cash Flow Improvement

COVID-19 CASH FLOW RISK MANAGEMENT

As a business leader, you may already be reviewing working capital and cash flow projections, running scenarios on profit and loss, balance sheets and cash flows with various degrees of interruption. It is important to review regularly to manage liquidity risk. 

Under the current circumstances, there are additional scenarios to consider including:

  • Reduced capacity
  • Parts of the business being inaccessible or shut down
  • The length of time the disruption lasts

WAYS TO IMPROVE CASH FLOW

Depending on your financial reserves and how exposed your sector is, you may need to think about any short-term cash flow solutions you could implement to improve your outlook. This could include:

  • Talking to lenders about expanding debt facilities
  • Postponing large financial outgoings
  • Anticipating contract problems
  • Arrangements with suppliers and landlords to extend credit

SUPPLY CHAIN

Businesses need to examine their ecosystem to identify where the vulnerabilities are. Supply chains have already been impacted following the shut-down in China, with more yet to come. 

DEMAND FORECASTING

When demand forecasting as a B2C company, take into account that consumers may behave differently during the pandemic. It is highly likely that consumers will still want to avoid gatherings or work from home, even after lockdown eases.

Business to customer (B2C) businesses should expect that, as demand drops, customers may want to postpone big buys and large financial commitments. They are also likely to be reluctant to commit to events that might not go ahead. 

Business to business (B2B) companies need to look at their customer base to understand how they could be exposed, in terms of the sales pipeline, stock and receiving payment – while at the same time maintaining existing customer relationships. 

OUTSOURCING CASH FLOW MANAGEMENT

Predictable business cash flow is important for any company to operate effectively and stay competitive. In our experience, the biggest threat to a healthy balance sheet is a lack of working capital – which can be caused by ineffective credit control.

By outsourcing your credit control, you can focus your energy on running your business and making more money, while our team takes care of improving your cash flow and credit rating.

How We Can Help

We take a flexible, tailored approach when working with our clients on outsourced solutions, giving you the freedom and scalability to cope with quiet or busy periods. We can help you with:

  • Credit Control
  • Overdue debt collection
  • Holiday and sickness cover
  • Credit management advice
  • Reviews of systems, processes and personnel
  • Audits – receivable reviews
  • Bespoke reporting and attending client visits
  • Ledger management
  • Debtor verification
  • Sales ledger monitoring
  • Insolvency recovery and services to Asset Based Lending

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WHY CHOOSE MAZARS

All of our financial services are backed up by decades of experience and expertise, as well as the latest industry intelligence and our technology.

Our research* found that only 16% of an in-house credit controller’s time is actually spent chasing debts, due to “a lack of time and resource”. Our free review examines your existing system processes and KPIs, so that we can advise on how outsourcing can improve cash flow.

*Mazars Source Credit Management Benchmark report

BUSINESS SUPPORT & ADVICE TO HELP YOU THROUGH

We’re here for you and we’re working hard to keep you informed on everything you need to know on business funding, CJRS, business tax planning, and more. If you need support with improving your cash flow.

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