The secret to stable cash flow for SMEs

Wavy water surface

Every business owner dreams of a time when they’ll finally be able to focus all their efforts on their customers and on growing their business. However, something always seems to get in the way. Equipment breaks down, suppliers go under, sales drop unexpectedly, and invoices don’t get paid on time. These interrupt your business’ cash flow, and can quickly lead to other, even more serious problems. Before you know it, a financial problem can lead to personnel disruptions, a decline in product quality, client retention issues, and eventually bankruptcy.

Import Financing

Getting control of your business’ finances, and developing a plan for dealing with inevitable disruptions, is a critical skill for any business owner. For small businesses, the key to doing that is understanding what tools are available to you, and knowing when and how to apply them.

Preventive tools

The best kind of cash flow problem is the one that never materialises in the first place. To help with that, there are a few preventive measures that businesses can use to protect themselves before anything even goes wrong.

Financed payment plans

The simplest and most foolproof way to stabilise revenues is to ensure that you’re not forced to spend weeks or months chasing down clients for payments. A great way to do that is to use a financial institution like Fifo Capital to offer financing to your clients. In this type of arrangement, you’d be paid the full sum up front, while your client can make more affordable payments on the purchase to the institution. That means you don’t have to worry about long-drawn out payment collection at all, and you can get your hands on the funds you need sooner and more reliably than you would if you handled it on your own.

Proper contracts

All great business relationships rely on well-written contracts, and these become doubly important when it comes to ensuring full and timely payment. Fortunately, making this happen isn’t necessarily as difficult as new business owners often seem to think. Practically no client is going to deliberatly enter an arrangement with you in bad faith, and you should expect that they intend to treat you fairly.

At the beginning of a relationship, clients will generally be happy to sign a fair and well-written contract, and won’t try to manufacture loopholes into it. The trick is ensuring that you didn’t include them on accident, which becomes an issue when a client runs into their own cash flow problems, and starts looking for options to protect their own interests. Because of this, it’s important to always work with a legal professional when writing contracts, no exceptions.

Reactive tools

Of course, cash flow problems aren’t just the result of late payments. Any number of things can go wrong, and after they do what they can to minimise the occurrence of cash flow problems, businesses need to make sure that they can quickly resolve those issues that can’t be prevented.

Short term invoice financing

Traditionally invoice financing is a relatively long term arrangement where a business generally stabilises their revenues by financing all of their invoices. However, short term invoice financing, where a business only finances one or a few invoices, can function like a short-term loan. In effect, you can give your business a quick advance on an outstanding invoice on a purely situational basis, instead of as a tool to stabilise income overall.

Stock loans

Stock loans are a unique type of secured loan, in that you don’t need to leverage an asset to secure it. Instead, the loan is secured against the stock you buy with it. This allows businesses that are fully leveraged to get access to the funds they need to keep their doors open and their shelves stocked. While this type of loan certainly occupies a relatively specific niche, it can be an invaluable tool for dealing with a budget shortfall.

Secured business loans

A secured business loan is a good general solution to help deal with unexpected costs, to fund growth, or to manage any kind of budget shortfall. It can be secured by many different kinds of assets, making it a very flexible solution that can be applied in situations where invoice financing or stock loans might not be sufficient or appropriate.

Successful business owners work first to reduce the incidence of cash flow interruptions, and secondly ensure that they have the tools they need to rapidly deal with those that do occur. This allows them to spend more time and energy focusing on their business, and less on worrying about whether next month’s billing cycle could drive their enterprise off the rails. If you’d like to learn more about these and other cash flow solutions, give us a call today!

  • Terms of the website use

    Please read these Terms & Conditions before using this site

    This terms of use (together with the documents referred to in it) tells you the terms of use on which you may make use of our website www.fifocapital.ie (our site). Use of our site includes accessing, browsing, or submitting information through our site.

    Please read these terms of use carefully before you start to use our site, as these will apply to your use of our site.

    By using our site, you confirm that you accept these terms of use and that you agree to comply with them. If you do not agree to these terms of use, you must not use our site.

    Other applicable terms
    These terms of use refer to the following additional terms, which also apply to your use of our site.
    Our Privacy Policy which sets out the terms on which we process any personal data we collect from you, or that you provide to us. By using our site, you consent to such processing and you warrant that all data provided by you is accurate.
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    Information about us
    www.fifocapital.ie is a site operated by Fifo Capital International Ltd (“We”). We are registered in New Zealand under company number 3856796 and have our registered office at 170 Parnell Road, Parnell, Auckland 1151, New Zealand. Our main trading address is 135 Parnell Road, Parnell, Auckland 1151, New Zealand.

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    Contact us

    To contact us, please mail to Fifo Capital International Ltd, PO Box 137375 Parnell, Auckland 1151, New Zealand, or email [email protected]
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  • Anti-Spam Policy

    What is spam?
    In the context of electronic messaging, spam refers to unsolicited, bulk or indiscriminate messages, typically sent for commercial purposes. “Electronic messaging” covers emails, instant messaging, SMS and other mobile phone messaging, but does not cover normal voice-to-voice communication by telephone.

    An electronic message may constitute spam if it:
    – is commercial in nature – i.e. it could be construed as offering a commercial transaction, such as goods or services for sale, or merely directing the recipient to a location where a commercial transaction could take place – is sent without the prior consent of the recipient;
    – fails to include accurate information about the sender; and
    – does not include a functional unsubscribe facility.

    Fifo Capital will take all necessary and reasonable steps required under relevant current Spam legislation to ensure that any commercial electronic messages sent to you do not constitute spam.

    Consent
    Fifo Capital will take reasonable steps to ensure that it has obtained your express consent prior to sending you electronic commercial messages about Fifo Capital’s products and services. Express consent may come in various ways, including subscribing to our mailing list, filing in a form, ticking a consent box to receive advertising or messages on our website, or consenting over the phone.

    Where it is impracticable to obtain your consent before sending electronic commercial message to you, we may infer that you have consented to receiving electronic commercial message. Inferred consent can occur:
    – via an existing business or other relationship with Fifo Capital, and where there is reasonable expectation of receiving commercial electronic messages; or
    – via conspicuous publication of a work-related electronic address; and
    – it is accessible to the public, or a section of the public
    – the subject of the message is directly related to the role or function of the recipient; and
    – the address is not accompanied by a statement saying no commercial messages are wanted.

    Identification
    Any commercial electronic message sent by Fifo Capital will include a clear and accurate identification information about Fifo Capital, the sender of the message and how we can be contacted. Fifo Capital will take reasonable steps to ensure that the identification information about Fifo Capital is accurate for a period of 30 days after the day on which you receive the electronic commercial message.

    Unsubscribing Policy
    Under Spam legislation, every commercial electronic message must contain a functional and legitimate ‘unsubscribe’ facility. This is an electronic address the recipient can use to tell the sender they do not wish to receive messages.

    Fifo Capital will take reasonable steps to ensure that:
    – all commercial electronic messages sent by us will include a functional way for the message’s recipient to indicate that they wish to unsubscribe from any future messages;
    – our unsubscribe links in any electric commercial message remain functional for at least 30 days after the original commercial electronic message was sent;
    – it allows the unsubscribe message to be sent to whoever authorised the sending of the message;
    the unsubscribe instructions are presented in a clear and conspicuous way;
    – a request to unsubscribe is honoured within five-(5)working days;
    – unsubscribing is at low or no cost, to the recipient.

    If you receive a message from Fifo Capital that is not in accordance with the above, contact us and the matter will be promptly investigated and resolved.

    Fifo Capital Unsubscribe Process
    The e-Marketing systems Fifo Capital uses for electronic communication allow recipients the option to automatically unsubscribe from any electronic commercial message.

    All manual unsubscribe requests go through the Marketing Manager or Operations Manager (as a secondary person). The necessary details for unsubscribing from any electronic commercial message sent by Fifo Capital are as follows:
    SMS: Subject Line: ‘Unsubscribe’
    Mail: Subject Line: ‘Remove’
    Post To: The relevant office as listed on the email
    Email: Subject Line: ‘Remove’
    Fax: Subject Line: ‘Remove’

    Fifo Capital Marketing
    Queries that are made with Fifo Capital through our marketing channels are gathered and kept confidentially. Fifo Capital may use some of this information to market its current and new products to customers. All marketing sent by Fifo Capital allows the recipient to opt out (unsubscribe) at no cost. If the recipient chooses to exercise that right they will be removed from any further marketing communication from Fifo Capital. Fifo Capital will not use electronic address harvesting software, or lists which have been generated using software, for the purposes of sending unsolicited commercial electronic messages.

    Contact Fifo Capital
    Please contact our Anti-Spam officer at [email protected] if you have any concerns or complaints about this policy or about our use of personal information or other privacy issues.

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  • Data Protection Policy

    See and print Fifo Capital’s data-protection-policy.

  • Terms and Conditions

    Fifo Capital understands time is critical when it comes to managing your cash flow – so our process is aimed to be as simple as possible.
    A Fifo Capital facility approval typically takes around 24 hours to set-up and depending on the required information supplied by customers, transfer of funds can take place in as little as four hours.

    The following covers the terms and conditions required for a four hour funds transfer to take place;

    1. Fifo Capital will tell the proposed client if the application is successful to receive funding. We can accept or reject the application at our sole and absolute discretion. If we accept the application the cash flow finance services will be provided solely in accordance with the documents we agree with the proposed client.
    2. Fifo Capital reserves the right to reject previously approved applications without notice and/or consultation.
    3. Fifo Capital’s application consists of a number of forms, however, not limited to fully completed and signed; Application, Receivables Finance Facility Terms and Conditions, Guarantee, Offer to Sell, and Privacy Consent forms
    4. To be eligible for a four hour funds transfer in relation to an approved application, the proposed customer must request or apply to Fifo Capital in writing before 12noon on the same business day. Such a request doesn’t guarantee the transfer will take place or funds cleared in the customer’s bank account within the four hour period.
    5. Should a four hour funding transfer request be approved, such a transfer can only be facilitated on a business day. A transfer request is not available on public or bank holidays, or weekends.
    6. Four hour funding transfers may incur a fee as detailed within the application.
    7. Fifo Capital’s aligned banks or financial institutions have the right to reject a four hour funding transfer request. Fifo Capital and its aligned banks are not liable for any loss or damages resulting from a funding transfer request not taking place or funds being cleared within a four hour period.
    8. Fifo Capital is a franchise business operation. Fifo Capital UK Ltd is the master franchisee and is therefore not responsible for the actions or inactions of its franchisees in relation to any funds transfer timing.
    9. Fifo Capital is not responsible for any loss or damages incurred or to be incurred by the would be or existing customer should a transfer not take place within or cleared funds not be received within a four hour period.

    To find out more about the full terms and conditions relating to our 4 hour funds transfer please contact Fifo Capital on 07812 334 564