It’s the final week of March and since the chancellor announced her budget in the Autumn, businesses have been wondering the implications of the tax changes and how they will affect their business from 6th April.
I am including below 5 ways that can help business owners to navigate their future cashflow and prepare for business growth.
Financial planning
I always recommend talking to your accountant or trusted finance person about your future tax liabilities and using a cashflow forecast to get a better view of the road ahead.
Calculate the impact of the national minimum wage and national insurance increase on your payroll and use this information to understand how much you must increase your sales by to cover this cost.
Businesses I am speaking with are considering a number of ways to mitigate the tax rise including increasing their prices or reviewing their future headcount requirements.
Cashflow timing
For some businesses, the time taken to receive payment after raising a request for payment can be up to 90 days.
In the meantime businesses are paying costs including building materials, salaries and travel which can put significant pressure on cashflow and jeopardise future growth.
Invoice finance solutions provide quicker access to cash and grows with a business. Primarily this involves raising moneys an at agreed limit against your ledger at a cost agreed with the lender.
This is particularly useful for growing companies where cashflow often struggles to keep up with increased workload.
And for retail businesses merchant loan solutions provide capital injection with an agreed payback percentage based on future card takings.
Equipment base
Tangible assets such as property, plant machinery or vehicles hold their value over a long period of time. With value tied up within, asset-based lending can help businesses refinance their assets to put money back into cashflow and fund future growth.
Even if your assets are still on finance, refinance options can help stretch your payments to meet the useful life of the asset and release hidden value better suited for other business needs such as hiring a new staff member or moving premises.
Cash injection
There are a range of secured and unsecured loan options that can provide a one-off injection of capital, repayment over an agreed period of time. With fixed monthly payments that provide budget certainty and help to prepare for future business growth.
Often suited to projects that do not involve equipment or commercial vehicles, can be for working capital purposes dependent on business and lender.
Maintenance costs
If your business needs equipment or vehicles to operate and you are experiencing increased repair costs or downtime. Consider upgrading to newer more efficient assets that will provide you with the certainty to take on new workload, and remove the unexpected cashflow hiccups of costly repair bills.
If you want to explore the finance solutions suited to your business, please get in touch.
You can check out examples of how we have been working with businesses here.
