As insolvency practitioners, one of the main causes of businesses experiencing financial difficulties is when they lose control of cash flow. When we are approached by businesses in difficulty, our first aim is always to see if we can help them turn their fortunes around and avoid a formal insolvency procedure, such as administration or liquidation. Very often, this will involve us helping them to find sources of finance to assist with cash flow, and this is when we approach funding and finance specialists for their expertise in finding the right form of finance and refinance for businesses that have sought our help and advice.
We are grateful to Natalie Knight a partner and funding specialist from our friends at Hampshire based Tempo Finance, for this article about using finance and refinance to manage cash flow.
Effective Cash Flow Management is Crucial
“Managing cash flow effectively is crucial for businesses to survive, ensuring you have enough funds to cover costs, invest in growth opportunities, and avoid financial pitfalls. One of the key strategies in helping to manage cash flow is utilising commercial finance and refinance options.
Understanding your options is key to finding the right solution for your business. Your balance sheet, sector, assets in the business and many more factors will have an influence on the type of finance you can access, as well as the rationale behind your requirement.
Cash Flow Options
Asset finance – This term covers several different products but essentially involves obtaining funding for specific investments such as vehicle or equipment purchases. From a funder’s perspective the risk is lower as there is an element of security within the asset itself. Monthly re-payments are fixed over a period (usually 3-5 years) with the option of taking ownership at the end of the agreement. This means you have use of business-critical kit from day one without the full upfront cost.
Refinance – This allows you to release value in assets that your business already owns outright (e.g. vehicles or machinery). Assets with no outstanding finance can be used as security and refinanced to a percentage of their existing value to release funds for other requirements.
Commercial Loans – A range of options available including secured and unsecured business loans. These can be used to raise working capital, fund projects or to cover HMRC and VAT payments.
Benefits of Financing and Refinancing for Cash Flow Management
- Fixed monthly payments
- Improved cash flow
- Access to immediate funds
- Preserved your working capital
Understanding your business and its requirements is key to securing the right funding for you. This is where an experienced broker can make all the difference. Taking on any additional finance needs to be for the right reasons and be costed correctly to ensure affordability. With over 90 lenders on our panel, we can search the market and arrange the best options for your business, saving you time and hassle and helping you to navigate the world of commercial finance.
Using finance and refinance options wisely can be a powerful tool for managing cash flow. By lowering monthly payments, consolidating debt, accessing immediate funds, and securing improved loan terms, you can enhance your financial stability and flexibility. However, it is essential to approach these options with a strategic mindset, carefully assessing your financial situation, shopping around for the best rates, and planning for repayment. With prudent financial management, you can leverage financing and refinancing to maintain a healthy cash flow and achieve your financial goals.”
Natalie Knight FCCA
Partner, Tempo Finance*
(*Disclaimer: Tempo Finance Limited is an independent Asset finance broker not a lender, as such we can introduce you to a wide range of finance providers depending on your requirements and circumstances. We are not independent financial advisors and so are unable to provide you with independent financial advice. Tempo Finance Limited will receive payment(s) or other benefit from the finance provider if you decide to enter into an agreement with them.
Tempo Finance Limited is an appointed representative of AFS Compliance Ltd which is authorised and regulated by the Financial Conduct Authority under number 625035.)
Talk to Tempo Finance or our Insolvency Practitioners for Help and Advice with Cash Flow
Insolvency practitioners are not just here for the times when administration and liquidation are the only options. Very often we play an important role in helping businesses in distress take the action needed to help turn things around, especially in difficult and uncertain times such as these. Using finance and refinance to manage cash flow, with the help of experts at companies such as Tempo Finance plays a big part in this.
If you are experiencing financial difficulties, then Contact us or call us on any of the numbers below for a FREE initial consultation with one of our team:
Also, K&W Recovery, trading as Antony Batty and Company, Thames Valley:
