Riding Out the Recession Business Recovery and Cash Flow Management Brian Denton iems ltd.

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Presentation transcript:

Riding Out the Recession Business Recovery and Cash Flow Management Brian Denton iems ltd

Business Recovery Introduction Why do businesses start?

Business Recovery Introduction Why do businesses start? It is a strength to recognise that external help is needed, not a weakness.

Business Recovery Introduction Why do businesses start? It is a strength to recognise that external help is needed, not a weakness. Why do companies get into difficulty?

Business Recovery Introduction Why do businesses start? It is a strength to recognise that external help is needed, not a weakness. Why do companies get into difficulty? The key to successful business recovery is to act early – as soon as a problem is identified.

Business Recovery The Process Initial assessment of the companies position.

Business Recovery The process Initial assessment of the companies position. Analysis of the company’s present financial position.

Business Recovery The process Initial assessment of the company’s position. Analysis of the company’s present financial position. Develop an understanding of the nature of the problem/s that the company has and the consequences.

Business Recovery The process Initial assessment of the company’s position. Analysis of the company’s present financial position. Develop an understanding of the nature of the problem/s that the company has and the consequences. Develop a plan to deal with the problem/s and its consequences.

Business Recovery The process Initial assessment of the company’s position. Analysis of the company’s present financial position. Develop an understanding of the nature of the problem/s that the company has and the consequences. Develop a plan to deal with the problem/s and its consequences. Prepare a financial plan comprising P&L, Cash Flow & Balance Sheet, phased by month.

Business Recovery The process Breakeven Calculation & Price

Business Recovery Managing Cash Flow Collect outstanding customer debts

Business Recovery Managing Cash Flow Collect outstanding customer debts. Invoice on the same day as delivery.

Business Recovery Managing Cash Flow Collect outstanding customer debts. Invoice on the same day as delivery. Reduce or eliminate credit given to customers.

Business Recovery Managing Cash Flow Collect outstanding customer debts. Invoice on the same day as delivery. Reduce or eliminate credit given to customers. Liquidate surplus stock and other assets.

Business Recovery Managing Cash Flow Collect outstanding customer debts. Invoice on the same day as delivery. Reduce or eliminate credit given to customers. Liquidate surplus stock and other assets. Extend credit taken from suppliers. Renegotiate terms & where possible extend credit limits.

Business Recovery Managing Cash Flow Collect outstanding customer debts. Invoice on the same day as delivery. Reduce or eliminate credit given to customers. Liquidate surplus stock and other assets. Extend credit taken from suppliers. Defer HM Revenue & Customs payments by agreement.

Business Recovery Managing Cash Flow Collect outstanding customer debts. Invoice on the same day as delivery. Reduce or eliminate credit given to customers. Liquidate surplus stock and other assets. Extend credit taken from suppliers. Defer HM Revenue & Customs payments by agreement. Consider Factoring or invoice discounting.

Business Recovery Managing Cash Flow Collect outstanding customer debts. Invoice on the same day as delivery. Reduce or eliminate credit given to customers. Liquidate surplus stock and other assets. Extend credit taken from suppliers. Defer HM Revenue & Customs payments by agreement. Consider Factoring or invoice discounting. Sell and lease back essential assets.

Business Recovery Managing Cash Flow Collect outstanding customer debts. Invoice on the same day as delivery. Reduce or eliminate credit given to customers. Liquidate surplus stock and other assets. Extend credit taken from suppliers. Defer HM Revenue & Customs payments by agreement. Consider Factoring or invoice discounting. Sell and lease back essential assets. Reduce overheads and direct costs wherever possible.

Business Recovery Managing Cash Flow

Business Recovery Prevent a Problem Turning into a Crisis Have a business improvement action plan in place and act upon it

Business Recovery Prevent a Problem Turning into a Crisis Have a business improvement action plan in place and act upon it Prepare a financial forecast / budget

Business Recovery Prevent a Problem Turning into a Crisis Have a business improvement action plan in place and act upon it Prepare a financial forecast / budget Keep management accounts up to date on Sage / Quick Books etc

Business Recovery Prevent a Problem Turning into a Crisis Have a business improvement action plan in place and act upon it Prepare a financial forecast / budget Keep management accounts up to date on Sage / Quick Books etc Compare actual performance with budget

Business Recovery Prevent a Problem Turning into a Crisis Have a business improvement action plan in place and act upon it Prepare a financial forecast / budget Keep management accounts up to date on Sage / Quick Books etc Compare actual performance with budget Spend time monthly analysing your management accounts

Business Recovery Prevent a Problem Turning into a Crisis Have a business improvement action plan in place and act upon it Prepare a financial forecast / budget Keep management accounts up to date on Sage / Quick Books etc Compare actual performance with budget Spend time monthly analysing your management accounts Address areas of under performance

Business Recovery Prevent a Problem Turning into a Crisis Have a business improvement action plan in place and act upon it Prepare a financial forecast / budget Keep management accounts up to date on Sage / Quick Books etc Compare actual performance with budget Spend time monthly analysing your management accounts Address areas of under performance Don’t ignore problems, they are not likely to go away

Business Recovery Prevent a Problem Turning into a Crisis Have a business improvement action plan in place and act upon it Prepare a financial forecast / budget Keep management accounts up to date on Sage / Quick Books etc Compare actual performance with budget Spend time monthly analysing your management accounts Address areas of under performance Don’t ignore problems, they are not likely to go away If in doubt, seek external advice from your bank / accountant / Business Link