Finance Director - Zamu

Finance Director

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Forecasting, Balance Sheet, Profit/Loss, Costs, Vat, Lending, Sales, Products and Logistics…

Funding Cashflow and Support

Kirsty and Sam have been working with a client to fund cashflow and ongoing support. The client had looked at the expenditure and considered they needed a loan of £20,000 – £25,000 for 5-10 years. The first step was to understand the expenditure and, its benefits and costs to the business. What income would the investment generate? Were the expectations realistic? Had any costs been missed? What are the VAT and tax implications?

Having analysed that, the next step was to prepare a project cash flow. This looks at when moneys would be due, rarely are all the costs incurred on day one and all the return at year five. Having looked at this in detail the result was that the project alone had a cash gap of about £15,000. A cash flow of the business is needed to understand how the cash flow would impact on other aspects of the business. This showed that the tightest point of the project is also at a tight point for the business, so a delay of 2 months would ease the whole process. Having done a total financial check, the suggestion was the client’s need would be better met by an overdraft for £15,000 for a period of 6 months.

An application and a supporting business plan was then written, and an appointment made to jointly visit the client’s bank to apply for the amount for 12 months. Now the client can move forward with the business, funding in place. With our on-going support to ensure targets are met and the investment is carefully managed to maximise future income.

So from a business looking for a £25,000 loan over 5 years to a £15,000 overdraft for 12 months benefitted and added value to the business.

Have you had a problem with the bank or funding? We would love to hear your story.