Nobody is paying us
Most days, the first thing I do is to log onto HSBC internet banking to see what cash has come in. It is an important exercise. You can spot problems quickly and deal with them.
I knew that May and June were to be the two toughest months of this year. We have no books being produced at Who’s Who, our new projects are just going online and leasing income will not kick in until July. Like most companies, we are delaying paying bills until the cash turns up.
On a positive note, our invoicing has been significantly better than forecast. We are now really turning the corner. I am predicting a must better cash flow than what I expected. I even told the Bank Manager, he would see a much improved position in our company.
What I did not expect was that no one would pay us. I am not talking here of the odd company with cash flow issues. I am referring to all our customers delaying payment. We will get the money, it’s just a matter of when.
This puts our cash flow under pressure which in turn makes the telephone ring more with those conversations that start with “can you put me through to your accounts department.”
UK business needs to tread carefully this year. New business is clearly picking up, but many companies are still struggling with cash. Overtrading will be a key issue as order books increase and there is not the money there to recruit and pay suppliers. Banks potentially will still be unhappy to lend to companies where their balance sheet has been eroded with the effects of the last few years.
Place your comment