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“Working as a part-time CFO with the CFO Centre is more rewarding than most corporate jobs.”

Andrew de Bruyn, portfolio CFO at the CFO Centre Australia
(part of the CFO Centre Group)

Andrew is a qualified Chartered Accountant who trained with BDO and has many years of senior financial experience, as CFO and Finance Manager, across diverse industries including FMCG, fashion clothing, diamond mining, and manufacturing.

When Andrew’s contract came to an end with the company he was working with he was looking for a new avenue, something outside of the daily grind of corporate life. At the time he was living and working in South Africa and, when approached by the FD Centre in Johannesburg (part of the CFO Centre Group), the timing couldn’t have been better. Andrew met with the Johannesburg Regional Director and decided to give it a try.

And he’s so glad he did! Andrew doesn’t miss corporate life in the slightest.

Andrew really enjoys the flexibility that portfolio working offers, as well as the stimulation of working with different personalities across a variety of industries. He finds he is able to add real value to his clients which is really appreciated by the business owners he works with, and he’s now working less hours, through choice, and has more time to spend with his family.

Are you looking to make a change? Get in touch – https://www.cfocentre.com.au/join-the-team/

Cash Flow Management; Cash is King.

Cash Flow Management; Cash is King.

Nick Crawford, Regional Director and Chief Financial Officer in Sydney, is qualified as a chartered accountant with extensive experience as a CFO in multiple different sectors. With over 20years’ experience as a CFO, we at The CFO Centre decided to question his knowledge on cash flow management.

What is the definition of Cash Flow?

There are two ways of looking at cash flow; in a set of annual accounts, you have a statement of cash flow and all it does is look backwards – it’s used to see how the business uses their money. In terms of our business (The CFO Centre), it’s a management term which measures, as one would expect, the inputs and outputs of the business. So, since the CFO centre is paid by a customer and uses that money to pay employees, suppliers etc. cash flow is the lifeblood of the business and, in the context that we’re talking about, it’s a tool that management use to make sure that that business keeps going.

No cash, no business.

How can having a good cash flow impact a business?

A good cash flow can impact a business in a couple of ways. Cash management is often very stressful for particular entrepreneurs who’ve set up a B2B (business to business/client). In Australia, a typical client is somebody who’s had a good idea, they’ve taken their business and is turning over 5, 10, 15, 20 million dollars but if they don’t have a sophisticated finance team behind them the ability to pay bills is a major concern. Therefore, having a tool that they can utilise, that states to them clearly where the cash-issues have come in and how to fix them, they can be confident in that their business will survive.

If you look at a business such as Facebook, for a number of years they made no profit. People believed in the platform and were pumping gas (funding) into it so, it kept going and look at where it is now. On the other hand, businesses who make profits but have no cash struggle because they can’t pay the staff, suppliers or invest money into the business. Very quickly, they’ll deteriorate due to the cash flow management issues. Cash is king and ultimately a business can’t survive unless it’s got positive cash flow.

What are the best tools and strategies for managing cash flow?

In terms of a strategic perspective, you’ve got to be robust but sensible. There’s no point in kidding yourself, it’s about using it as a tool to identify when potentially you’re going to hit a pitfall and you need to be able to deal with it. The other thing is also to be able to use it effectively. We’ve come across a number of people who use cash flow as a tool and then want to hide, bury their heads in the sand and not use it because it doesn’t give them the answer that they want to see, instead it identifies a cash flow problem.

What it might mean is you’ve got to go do something different; you may ask your bank for an overdraft facility, you might have to go to an invoice discounting facility to get cash quicker, if you’re in the growth stage of your business you might end up going to an external investor. So, it’s supplemented by other factors, like raising finance to make sure that you can keep your business going.

At The CFO Centre we have a model that demonstrates numerous brick walls that you’ll hit whilst in the different stages of your business. When you hit the second brick wall, cash flow would be a major issue because it consumes a lot of cash and often, you invest before you get the return. It’s imperative that people use a good cash flow tool to save money, to look at and predict the future but also manage within their means or identify the need to go out and find extra resources to get them through that process.

What you think is the best way of calculating cash flow for an SME that’s scaling up?

Cash inflows versus cash outflows.

It’s using the information you’ve got, typically the SMEs are not great at forecasting forward, a lot of it might just be what’s in front of them. It might be taking the invoices that roll to them and the invoices that they’ve got to pay, their payroll and using those to put together a realistic plan. It’s more about using the information around you and being sensible about it.

what’s the difference between a cash flow forecast and a cash flow statement?

A cash flow statement is something people put in their accounts. It’s a requirement, in Australia, for a company of a certain size to have to put a cash flow statement in. Basically, it takes the financial period that you’re looking at – which is split traditionally and historically – and you have to state what you did with the cash between the previous year and this year. ‘I paid employees, bought fixed assets, I invested in a that etc.’

A cash flow forecast is a forward-looking tool. The tax accountants and the accountants will do the cash flow statement (which is looking historically), whereas cash flow forecast is a forward-looking tool, but both are useful in knowing to grow the business.

Have you come across any examples of how clients have needed help with their cash flow?

Our Christmas holidays and our summer holidays coincide, so we have a period where if you’re a service-based business like The CFO Centre, you might not earn money for four weeks; but you’ll still have to pay staff, rent and ongoing bills. It creates a problem around March and April because of the quarterly tax (GST) – it’s like you’ve not had any money for two months and now you’ve got these big bills to pay back.

In terms of SMEs, I’ve come across some where they’ve not used cash flow as a tool; they’ve just continued to pay what’s needed when they’ve got money in the bank, they don’t foresee the problems coming along. Often the major problem is the ATO, if they did not pay the ATO they find themselves with a difficult issue that they can’t fix; they end up burying their heads in the sand and hope it will go away – it doesn’t. I’ve had clients where I’ve had to dig them out of a deep hole with the ATO, which showed me how vital cash flow management is needed by every client that we deal with.

I have one client who gets paid in advance, so they have positive cash flow. They’re probably the only one as they get their money up-front, it’s a different sort of cash flow management – it’s about investment to make sure you maximise the returns you get on your cash balances. Most of the businesses we work with do the service and get paid afterwards, so cash flow management is just a key management tool, particularly in the space that we, as The CFO Centre, work in.

What’s the best bit of advice you can give to small business owners to improve their cash flow management?

I think, in a lot of instances, they don’t usually do it, I think it’s a tool that people choose not to or maybe don’t have the skill set to use accurately. I think the best sort of advice would be to follow what the forecast is telling you. You can’t just ignore a problem, you need to react to what the issues are with the best solution (borrowing money from your bank, talk to people like us at The CFO Centre etc.).

It’s no different to us as individuals, when you get to a point when you want to go out on a Friday night and you’ve no money, you can’t do it. Businesses will not have a good cash flow management if their cash positioning and financial management is under-performing. Again, cash is king, if you do not have enough cash or the strategies in place to predict issues like low cash flow, then you need to look into solutions that line-up with your business plan and payment methods.

“I worked hard to work my way up to CFO and Company Secretary of a large public listed company but when I arrived, I wasn’t experiencing the job satisfaction and sense of achievement that I craved.”

Andrew Bell, Portfolio CFO at the CFO Centre, Western Australia
(part of The CFO Centre Group)

Andrew Bell has an enviable CV. With 25+ years working with fast-growing companies, he’d worked his way up from Graduate Accountant to an ASX 300 CFO and Company Secretary.  But, in Nov 16, he wasn’t feeling quite as fulfilled as he thought he would as the politics in the corporate environment were preventing him from enjoying his roles.

Andrew took time to consider what it was that he enjoyed about his career and concluded that he loved working directly with owners and entrepreneurs to develop and improve their businesses. He made the decision to join the CFO Centre and now feels that he is putting his experience to good use as he is able to make a real difference to his clients’ businesses.

“The CFO Centre has provided me with the opportunity to work with multiple growing and developing companies over the past 2 + years for mutual benefit and great job satisfaction.”

He’s also a great advocate for the team-based approach at the CFO Centre.  He visits his clients regularly and enjoys mentoring and coaching staff within the finance functions. There’s also a great team spirit amongst the CFOs where they share their knowledge and assist with client situations which creates a great learning environment for everyone.

 Are you searching for a more fulfilling role?

Are you open to a discussion about joining our team?

We’d love to hear from you – https://www.cfocentre.com.au/join-the-team/

“This is probably the happiest I have ever been for a number of reasons.”

Zara Merricks, portfolio FD at the FD Centre
(part of The CFO Centre Group)

Zara works as a portfolio FD for between five and 10 clients at a time. She works for the FD Centre, the largest provider of part-time FDs in the UK and is delighted to see the rapid difference she makes to companies she works with. Since joining the FD Centre over two years ago, Zara is enjoying the opportunities that have come her way.

Although Zara’s keen to tell us that it’s the best career move she’s ever made, she’s also honest about the need to become extremely organised.

“I recently started doing virtual FD work as well as well as portfolio work. I might spend a day a month in a client’s office and the rest of the time working from home. The virtual FD work I plan six months in advance and the portfolio work I plan six weeks in advance. So, you do have to have time management skills.

Working with five clients at the same time, it can be a little challenging deciding who takes precedence. But that’s a minor downside.”

And apart from feeling like she’s making a difference… what are the other reasons for Zara’s happiness?

The flexibility of course. Being in control of her diary, not missing out on ‘the important things in life’ and making adjustments to support her own well being.

Surely, that’s worth getting organised for, isn’t it?

If you’d like to chat to us, we’d love to hear from you – https://www.cfocentre.com.au/join-the-team/

“With portfolio working, I’m not pigeon-holed into one particular area of expertise.”

Tony Lewis, portfolio FD at the FD Centre in the South East
(part of The CFO Centre Group)

With 30+ years’ experience in the corporate world, both in the UK and globally,  Tony has been there, done that, got the t-shirt. But by working for one of the top management consultants and supporting many US-listed companies, it’s very easy to be known for one particular type of situation.

Then there’s always the next client waiting for your support and advice.

Of course, it’s good work and he’s proud of what he achieved. But when the appeal wears off and there’s no time to really enjoy the important things in life, something’s got to change.

Tony was ready for a new challenge. He wanted more time and space to have input into family life – to reduce the time he was travelling and help to settle his children.

For this reason, he approached the FD Centre to become a part-time FD.

And he has never looked back to the big job in the City and the international travel.

For Tony, the flexibility the role provides has meant the world to him. He can enjoy a challenging & rewarding professional life balanced with time for family, friends, sports & hobbies.

He also finds the role extremely fulfilling. Good practice and insightful advice aren’t just expected, they’re really appreciated.

“Instead of spending my time worrying about multinationals, I’m now helping a family-run business improve profit & cash generation. We’re talking livelihoods and real people. And it’s so much more rewarding.”

If you’d like to think about how portfolio working could work for you, we’d love to hear from you – https://www.cfocentre.com.au/join-the-team/

“I value the security that being a part-time FD with half a dozen clients brings.”

Michael Citroen, portfolio FD at the FD Centre in the Thames Valley
(part of The CFO Centre Group)

Michael Citroen is 59 years old and a 14-year veteran of the part-time portfolio job world. The former Group Finance Director of a large privately-owned company relishes the challenge and excitement of working with SMEs in his role as a part-time FD.

“The FD Centre is very focused on helping its part-time FDs to win new clients”, Michael says. “I could never have done as well as I have if I’d had to do it on my own as I had no idea about marketing when I first began.”

Like many people starting out on the part-time path, Michael had initially been worried about giving up a salary with all the perks. “To begin with, I felt a little insecure giving up a regular job, but the role was becoming increasingly political and I wanted to take back control.”

He quickly discovered that the financial return you get from this way of working is dependent on the amount of energy you’re willing to expend and the number of clients you take on.

He realised early on that the new lifestyle would enable him to spend more time with family whilst maintaining a good level of income.

Surely, if Michael’s still buzzing about this way of working after 14 years, it’s worth finding out a bit more about it. Isn’t it?

If you’d like an exploratory chat about portfolio working, we’d love to hear from you – https://www.cfocentre.com.au/join-the-team/

“Joining such a knowledgeable team of professionals made the transition from corporate life so much easier for me.”

Jim Laslett joined the FD Centre in 2015 and has enjoyed the diversity that his new role brings.
(part of The CFO Centre Group)

After a chance meeting at a Christmas lunch in 2014, Jim decided to explore the opportunity of working with the FD Centre and later joined. Jim’s previous experience in retail and manufacturing has enabled him to look after a number clients from very varying industries – from an electrical wholesaler to a supplier of specialist products to fruit farmers, to a provider of care equipment to homes and hospitals.

He certainly enjoys the variety of portfolio working. And there’s peace of mind knowing that if there’s something he needs additional guidance on, he can always count on his team of colleagues, nationally and internationally, to provide specific industry knowledge. The team is so powerful.

“I get such job satisfaction from helping entrepreneurs reach their business goals. I’m so passionate about working with my clients that I could easily spend double the hours I’m contracted to work with them. The skill comes in prioritising, managing expectations and enabling the team, and I’m always available to discuss their progress if they need me.”

And with a rapidly increasing number of colleagues across 16 countries, it’s great to know that many others are also choosing the same lifestyle.

Are you ready for a conversation? We’d love to hear from you – https://www.cfocentre.com.au/join-the-team/

“Portfolio working allows me to keep close to the business I founded, whilst supporting other entrepreneurs

Chris Willford, portfolio FD at The FD Centre in the Thames Valley
(part of the CFO Centre Group)

“Portfolio working allows me to keep close to the business I founded, whilst supporting other entrepreneurs and doing the things I love.”

Chris Willford joined the FD Centre back in 2016 after over 30 years working in FTSE 100 companies and the creation of a successful software business.

Having worked his way up to FTSE board level in two different industry sectors, Chris felt it was time to do his own thing, so in 2011 he joined forces with a friend and neighbour, said goodbye to corporate life and started a software business. Together, they established business relatively quickly, and after setting a good solid foundation, Chris concluded the business didn’t need his financial experience full time.

He wanted to stay close to the business, but it didn’t make sense for him to spend time on non-strategic or non-financial tasks that other people could carry out. Chris, therefore, decided to reduce his hours with the company – staying involved in the strategic direction and freeing up time for him to support other entrepreneurs.

After a chance meeting with a regional director at the FD Centre in 2015, Chris joined the FD Centre team the following year. He now looks after a number of businesses, working mainly in the tech, media and publishing sectors.

“I enjoy being in control of my own diary, and the variety of the work means there’s always something interesting to work on. I oversee some really strong and diverse businesses and there’s no shortage of opportunities to make a difference in each one.”

Oh, and when he’s not checking in with one of his clients, you may find Chris cycling with his local road cycling group…if you can catch him of course. You see, he has made sure he sets time aside for the work-life balance we all crave.

Are you ready for an initial chat? Call us  – https://www.cfocentre.com.au/join-the-team/

Top 9 Advantages of a Part-Time CFO

Top 9 Advantages of a Part-Time CFO

The quicker you want your company to achieve its goals, the sooner you should consider hiring a part-time CFO.

That’s because a part-time CFO will provide your company with the high-level financial expertise necessary to scale up (things you and your team may not even be aware you need), for a fraction of the cost of a full-time CFO.

Hiring a part-time CFO provides your company with many advantages that really help it to grow and stand out in any marketplace. But here are the top nine advantages you and your employees and stakeholders can expect when you hire a part-time CFO.

  1. Cost-saving

By hiring a part-time rather than full-time CFO, you can avoid the often-hefty recruitment and hiring costs (and the delays they inevitably entail). What’s more, you can hire a part-time CFO for a fraction of the cost of a full-time employee. You won’t have to offer a benefits package or bonuses to retain the appointee.

  1. Strategic advice

Your part-time CFO will provide you with strategic analysis and support on every financial aspect of your business. A report from the Financial Executives Research Foundation (FERF) described CFOs as “critical to the success of start-up and early-stage growth companies” since they provide key insights.
It found CFOs play key roles in not only managing a young and fast-growing company’s finances but also in setting broader strategic goals and establishing and achieving financial and non-financial milestones.

What’s more, part-time CFOs can highlight potential threats or risks of which you and your team may be unaware or perhaps don’t know how to deal with.

  1. Flexibility

You can use the services of your part-time CFO for what you need when you need it. That could be for a variety of different financial functions or a specific project. This means you and your CFO can tailor the role to suit your company’s needs at any time.

  1. Multiple industry experience

Although you can choose to work with part-time CFOs who have direct experience in your given industry, you can also opt to work with those that have experience across multiple industries. The advantage will be that your CFO will provide you with access to networks and multi-layered insights that you might not otherwise have.

  1. Crisis management

The loss of major contracts, customers or employees can be devastating for any business. Your part-time FD or CFO will be able to help you and your team navigate your way out of the crisis. This could include producing short-term cashflow reports, identifying costs that can be cut, producing new financial forecasts, and helping with raising vital funds.

  1. Sounding board

Running a company can often be a lonely, stressful experience for CEOs, according to the FD Centre’s Chairman Colin Mills in his book ‘Scaling Up How to Take Your Business to the Next Level Without Losing Control and Running Out of Cash.

He’s seen first-hand what pressure does to business owners.

“I’ve sat in sales meetings with entrepreneurs who had literally been brought to tears by stress and frustration and the feeling that it’s all too much.”

That’s where a part-time CFO can help. He or she can act as an independent sounding board for the over-burdened, stressed-out business owner. With their ‘big business’ experience, it’s more than likely CFOs can provide solutions to what can seem like overwhelming problems to the CEOs of growing businesses.

  1. Mentorship for your team

Part-time CFOs help to establish sound reporting systems and tools that help improve reporting metrics and communications to investors. They can also act as mentors to members of your existing finance team, guiding them where necessary and providing the advice they need to rise to new challenges.

  1. Access to a national and international network

If you choose a part-time CFO from an organisation like the CFO Centre, you’ll benefit from the expertise from all the CFOs in its worldwide network. That’s hundreds of years of experience in every aspect of finance—all for a fraction of the cost of employing a single full-time CFO.

  1. You won’t get left behind

If you’re still hesitating about whether now is the right time to hire a part-time CFO, consider the sorry tale of Kodak—a company that got left behind, despite once being one of the most powerful companies in the world.

Kodak was once known for innovation (being the creator of the Box Brownie camera, Kodachrome film and the Instamatic). Here’s what’s remarkable—a Kodak engineer Steve Sasson developed the world’s first digital camera way back in the mists of time (actually, 1975). Okay, it was the size of a toaster, took 20 seconds to capture low-quality images which had to be viewed on a TV. But still… it had the potential to disrupt the market massively.

The company poured billions into developing the technology to take photos using mobile phones and other digital devices but delayed acting on it due to fears digital technology would destroy its film and photographic developing business. It failed to act fast enough and to identify the opportunities posed by digital technology.

On January 19, 2012, Kodak filed for bankruptcy protection in 2012, then exited its legacy businesses and sold off its patents. It re-emerged in 2013, albeit in a vastly slimmed down version of its former self.

If you want to avoid becoming a post-script or salutary tale in your market, appoint a part-time CFO. He or she will provide you and your team with strategic help and advice to recognise threats and to seize opportunities—thanks to vast experience and expertise.

The CFO Centre offer the services of part-time CFOs with big business experience who can use what they know to help your company achieve rapid yet sustainable growth. What’s more, they’ll help remove fear, confusion and stress from the entire process.

To discover how the CFO Centre will help your company to scale up, please call us on 1300 447 740 or contact us here.

How it works

The CFO Centre’s part-time CFOs use a proven framework known as the ‘12 Boxes’ to identify where the problems are within any business. They use it to review every aspect of your company finance function and identify every problem area.

They will help you to understand your company’s finances and not only eliminate cash flow problems and identify cost-savings but also to improve profits.

They can also help you and your team to understand your main profit drivers; find and arrange funding; identify your Critical Success Factors and Key Performance Indicators (KPIs), help you to expand nationally and internationally; and build value to make your business more attractive to investors or buyers. To discover more about the 12 Boxes, click here.

Need help?

To find out how an CFO Centre part-time CFO will help your business, contact us now on 1300 447 740. To book your free one-to-one call with one of our part-time CFOs, click here.  You can see how they add rocket fuel to any business here.

What people are saying

People are talking about what they really think of the CFO Centre’s part-time CFOs. Find out what they’re saying on these short videos here.

Where are you going wrong?

You can identify strengths and weaknesses in your business in just nine minutes with the F-Score click here now. Just answer a brief series of questions, and you’ll receive an 8-page report that will reveal potential current or future pain points for your business. It will also help you to rate the performance of your finance function and uncover untapped opportunities for growth. Click here now to take the F-Score.

Got a Big Question?

Have a burning question for one of our team of CFOs? Just ask it here, and you’ll get an answer within 24 hours. The question must be finance-related (sadly, they can’t predict who will win Wimbledon).

Where to Find the Cash You Need

Where to Find the Cash You Need

A lack of cash can not only stall your company’s growth but also place its very existence under threat.

It doesn’t matter how profitable the business may be; cash flow problems can place it under severe pressure, according to the CFO Centre’s Chairman Colin Mills in his book ‘Scaling Up How to Take Your Business to the Next Level Without Losing Control and Running Out of Cash.

“You might think you’re immune from danger because your business is experiencing a high level of growth, but you’re wrong: expansion can exacerbate the problems caused by poor cash flow management,” he said.

“You almost always have to make investments and bring certain expenses on ahead of achieving the higher revenue and cash flow that comes with successful growth.”

It is the oxygen every business needs to survive.

“The stark truth is, without cash your business will be unable to meet its payroll obligations, default on payments to suppliers and creditors (payables), and ultimately cease trading.”

Fortunately, there are ways to find cash both from within your business (by improving processes, cost-cutting and selling off unused assets) and from traditional and alternative external funding sources such as banks, invoice factoring companies and crowd-sourcing platforms.

Getting the cash your company needs earlier rather than later can not only save you and your employees from unnecessary stress but also help you to achieve more rapid growth as the following example illustrates. One of the CFO Centre’s American clients had over-hired which caused it to run into cash flow problems.

But with the help of the CFO Center, the company was able to survive the blip and then attract one of the ‘Big Three’ automobile manufacturers in the US—Chrysler—as a client.

“They were really bumping up against their credit line of $US500,000,” recalled the CFO Center’s Boston Regional Director in ‘Scaling Up. “We came in, restructured their financing and their forecasts, and in a couple of months we were able to get them a new line of credit for $2 million,” he said. “That effectively allowed them to invest in the growth of the company.

“A year after we were engaged, the client won a massive deal with Chrysler. Chrysler conducts vendor analyses on the financial position of its vendors, and this company got a green light across all areas that Chrysler reviewed them on.”

Look within your company first

While many business owners automatically look to external funding sources, it pays to look closer to home first.

“Most entrepreneurs don’t realise there is often considerable funding to support growth from within their own business,” says Mills. “That’s because the collection of customer receivables can often be improved through strong credit control and the level of stock holding reduced through improved systems and processes. In some instances, poor negotiation of supplier payment terms means less funds are available within the business to support scaling up.”

So before you pick up the phone (or click your mouse) to apply for external funding, consider the following methods for freeing up cash within your business.

Declutter

If the business has machinery, equipment or large amounts of stock that is idle, consider selling it or renting it to other businesses.

Remove unnecessary overheads

Look at all your overheads to see if they can be lowered. For example, consider reducing staff numbers, or not replacing employees when they leave or moving premises to get a more favourable lease.

The head of the Australian CFO Centre recalls how one part-time CFO was asked to help a fast growth branding business that had got into trouble with cash flow. Most troubling was a looming $AUD 500,000 tax bill.

At the company’s headquarters, it was easy to see why the company was struggling: the carpark was crammed with ‘flashy’ company cars.

A conversation with the owner revealed he did not have a good grasp on his financials. He didn’t know how to improve his margins and had no idea how much his product was costing to produce.

So he was advised to sell the cars and make half the staff redundant.

“We were really hard with the guy; we took a firm line with him, but he did all the things we suggested he do to get his business back in order,” the part-time CFO said. “That was three or four years ago, and today his scaleup growth has delivered the cash flow and sustainability, to where he should have been if he had the financial nous beforehand.”

Negotiate better terms with vendors

Ask for more favourable payment terms from your suppliers. This doesn’t necessarily mean asking for reduced prices but could be as simple as requesting an extra seven days for your payment window.

If your suppliers refuse your request, look for other suppliers who can offer lower prices or better payment terms for the same quality of product.

Resolve late payment issues

Make your payment terms clear to minimise the possibility of late payment issues. Try to keep to the same terms for all your customers (for example, a 30-day window for payment of the invoice). Get agreement to your payment terms from all your customers or clients. Carry out credit checks on all new customers or clients. Ensure that invoices are issued promptly. Ideally, you should issue invoices by email on the day of completion of the job or project and ensure that overdue payments are pursued.

Get deposits for large projects or orders. Build a deposit (of anywhere up to 50% of the total cost) into your contract for large projects or orders. This is especially important if the projects or orders are likely to involve a lot of resources and time.

That way if the customer decides to cancel the project or fails to pay the balance on the project or order, you have at least recovered some of the cost of the resources and time you’ve already invested in it.

Look for External Funding

You should also consider external funding sources to help ease your cash flow challenges. There are a dizzying number of sources to consider, both traditional and alternative (which is why you should use the services of a part-time FD or CFO to identify the best method for your company and help you navigate your way through any such process).

Apply for a bank overdraft

A bank overdraft has been the traditional form of funding for many businesses. But these days, banks are more likely to try to steer their clients to other forms of debt that provide the banks with more security.

While overdrafts are usually quick to set up, they have a major drawback, and it’s this: banks can call them in on demand.

Request a bank loan

The advantages of bank loans are that they are for a set term with regular repayments and that the banks can’t call the money back on demand. The downside is that banks will demand strong security for the loan such as a personal guarantee secured on the assets of the business or even the owner’s personal assets.

Use asset financing

Using your assets as collateral for the loan is one of the easiest ways your growing business can get access to quick cash. However, there is a drawback: not all assets are considered equal.

Typically, lenders will only consider assets that they can sell quickly if you default on the loan. Therefore, they usually want high-value assets with a low depreciation rate or high appreciation rate, and which are easy to convert into cash.

Get alternative financing

The alternative finance market includes a wide variety of financing models including peer-to-peer lending, crowdfunding and specialist finance providers offering products such as selective invoice finance and invoice trading platforms.

The benefit is that since they have greater flexibility than traditional funding sources they can often offer a faster turnaround on the right deals.

Invoice Discounting

The advantage of invoice discounting, in which banks and invoice discounting companies lend money secured against your debtors/receivables, is that you can borrow up to 80% of the invoice amount within 24 hours. So you get the cash flow benefit and the rest when the money is collected.

The disadvantage is that it can cost more than overdraft or loan charges so it may have a bigger impact on your profit margins.

Peer-to-peer (P2P) lending

P2P platforms match lenders directly with borrowers so that you can borrow money from individuals. The huge benefit of this is that the rates are favourable and often much better than any other type of lending method. The disadvantage is that you will still have to undergo a credit check and possibly pay an application fee.

Equity-based crowdfunding

The way it works is that people come together on the crowdfunding websites to pool money towards a particular venture or idea in return for an equity share in your business. The issue with crowdfunding though is that it’s not as easy as some people make it out to be, as it requires months of planning and lots of marketing in order to get people excited enough about what you are doing to contribute money towards it. There’s also the risk that you don’t receive the amount you’re seeking, in which case any finance that has been pledged will usually be returned to your investors, and you will receive nothing. If you’re successful, there’s the risk you give away too much control in your company. This could have an impact later when you decide to sell the company.

The easy way to raise cash

Of course, you can make the finding or raising of cash a much easier process by engaging the services of a part-time CFO. For example, The CFO Centre Hong Kong offer the services of part-time CFOs with big business experience who can use what they know to help you uncover or obtain the cash you need to help your company achieve rapid yet sustainable growth. They will help remove the fear and confusion from the entire process.

To discover how the CFO Centre will help your company to get cash and scale up, please call us on 1300 447 740 or contact us here.

How it works

The CFO Centre’s part-time CFOs use a proven framework known as the ‘12 Boxes’ to identify where the problems are within any business. They use it to review every aspect of your company finance function and identify every problem area.

They will help you to understand your company’s finances and not only eliminate cash flow problems and identify cost-savings but also to improve profits.

They can also help you and your team to understand your main profit drivers; find and arrange funding; identify your Critical Success Factors and Key Performance Indicators (KPIs), help you to expand nationally and internationally; and build value to make your business more attractive to investors or buyers. To discover more about the 12 Boxes, click here.

Need help?

To discover how an CFO Centre part-time CFO will help your business, contact us now on 1300 447 740. To book your free one-to-one call with one of our part-time CFOs, click here.  You can see how they add rocket fuel to any business here.

Where are you going wrong?

To identify strengths and weaknesses in your business in just nine minutes with the F-Score click here now. Just answer a brief series of questions, and you’ll receive an 8-page report that will reveal potential current or future pain points for your business. It will also help you to rate the performance of your finance function and uncover untapped opportunities for growth. Click here now to take the F-Score.

Got a Big Question?

If you have a burning question for one of our team of CFOs, ask it here, and you’ll get an answer within 24 hours.

Scale Up: How to Take Your Business to the Next Level Without Losing Control and Running Out of Cash’, Mills, Colin. BrightFlame Books, 2016

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