Cash Flow in a business can sometimes be a problem if the company is not generating enough money. Sometimes this is extremely short term and the company could have recently received some tremendous bill or they have had a poor few months of trading. Generally, companies are advised to keep at least three times the amount of general outgoings aside in case something goes wrong and they start making a short term loss. This ensures the necessity items are paid for such as rent or salary. There may even be an option for you to consider getting some independent advice from a financial broker. Firms like Genie Loan Brokers could be useful in helping with short term cash flow issues, or even you require funds in order to support you with a major project or similar. Here are some of the things a financial broker can help you with.
Receiving a business loan may a consideration from you for a few reasons which could include investing in a project or new expansion to your company. A broker can help you secure the funds however clearly there is some criteria expected from you to complete:
- Business case – If you are looking for the funds to complete a specific project then a business case will be required in order to ensure that the funds are not wasted and that it is going to good use.
- Financial history – The broker will be looking at your financial history to understand if you have cash flow or payment issues. If you do then this can obviously affect your ability to get a loan. Credibility around paying previous bills is a must especially things like mortgages or rent.
- Credit score – Again, all around your financial history, they will look at your current credit score from companies such as Experian. If you have been defaulting on payments then clearly this affects your credit score. In addition to this, your score is affected by things such as, too many creditors, large amount of debt or applying for numerous sources of credit in a short period of time.
Not everyone that goes into business is an expert on financial planning and budgeting. Sometimes it may be better for you to reach out to an expert in order to assist you grow your business more effectively. This source of help will clearly cost you some money up front however in the longer term you may see this adding a lot of value.
There may be a consideration for you to get a commercial mortgage instead of you paying out in rent. By doing this, you would clearly add a lot of value to your company however the deposit and funding required to do this could be significant. The help of a financial broker will assist you in scoping this out and understand if it is even affordable in the first place.