Cashflow concerns: time to address the financial ‘elephant in the room’

 

Even with strong sales or a large customer base, many businesses can still struggle with financial difficulties or cash flow concerns at any given time.

Cases range from minor cashflow hiccups (maybe a debtor hitting issues of their own or taking longer to pay than expected, or a production delay resulting from key component shortages) to serious cases of potential or actual insolvency.

This is where a part-time CFO can help you through and get back on track, by reacting fast and addressing the risks. At The CFO Centre, our CFOs become a profit-generating resource rather than a cost.

 

Our top tips and real-life client examples 

We have helped many businesses who are at various stages of cashflow concerns.

Often, our CFOs quickly implement a few simple strategies, and cash flow improves.

If the issues are more serious, we will work with directors on the best course of action, and we have great relationships with many funders or licensed insolvency practitioners, who can come alongside us during this time.

 

Here’s what our CFOs have achieved for our clients recently:

 

• We had a client that did not realise that they had 5 yearly subscriptions scattered across various payment options (company credit cards, direct debit, personal credit card that is then reimbursed). It was costing them just over $10,000 per year and they were not using the subscriptions or licenses to the full benefit. We cancelled two and reduced the number of licenses for the other three subscriptions, saving $6,000 p.a.

 

• Another client heavily invested in Research & Development was missing out on valuable tax offsets. By streamlining their data collection and ensuring timely lodgement, we helped them claim significant tax benefits – often enough to cover the cost of their fractional CFO.

 

• We often look at a clients existing creditors list to negotiate deferred payment plans, when necessary, plus work with existing debtors to bring in aged debtors.

 

• We also look at ways to reduce overheads – such as rent and staff management. We can benchmark these percentages to track these expenses as a percentage of revenue.

 

These examples show how with the right financial oversight, businesses can unlock hidden savings and maximise returns.

 

The CFO role is critical in finding solutions for your cashflow concerns

The role of your CFO is to advise on the most effective course of action, not to assume the responsibilities of a director.

Our CFOs come with key analytical skills and the ability to review your company’s position objectively. This is hugely important because, when things are going wrong, management teams and/or directors can make emotional rather than rational decisions. Clear, unambiguous advice coming from your CFO, even when it is giving a difficult message, is invaluable.

 

Act now!

There is no point looking the other way if you have genuine cashflow concerns or debt worries.

It is always better to seek help with your debt, as the more informed you’ll be about your options and gain control of your situation.

Contact us for a confidential call on 1300 447 740 or submit a request for a free discovery session