ALTERNATIVE APPROACH

The phrase today is CASH IS KING, so getting funds into your business to fund your sales and gross profit is the key.  While cutting overheads is the typical approach and very much worthwhile, it will not get money in.  It will retain more money but will not generate new funds.

Yourbusiness.ie has successfully secured money in the five types below (A to E).  Types A to D are the alternatives that may not come to mind when thinking for new cashflow.  We have achieved success on each type.   See the types listed below:

Type A
- the balance sheet
- off balance sheet assets
- terms & conditions
- processes 
- logistics / supply chain


Type B
- Grants
- State aid
- R&D refund from 1 January 2009


Type C
- New equity
- BES
- Equity bridge
- Facility loan
- Facility guarantee
- VC route


Type D
- Factoring or invoice discounting
- ABL
- ABL by alternative source
- Supply-line / pay-line


Type E
- Traditional bank lending (overdraft or term-loan)


Level of funds from Type A
Simple changes to the above and balance sheet review can yield significant gains in cashflow.  This is money in, equivalent to about 15% of sales.  So if your turnover is €2m that's €300,000 in new monies in.  Equivalent to a costly overdraft with significant security conditions.  This is a simple example but very much possible, in some cases not achieveable.  Each case is different.  We speak from experience.
 

Level of funds from Type B
This level is dependent on the size of business and the business type.
If you are in R&D, you can get a 33.33% refund of your R&D credit (25%).  So even if you do not have profits and have a tax credit you can claim a partial refund.  We have seen a number of examples of companies forgetting about this point, even after taking professional advice.  One recent example in 2009, yielded a refund even after the CT submission.  A major oversight at the time but a welcome cash injection before Christmas.


Level of funds from Type C
Equity funding is expensive today, as people with cash recognise the power and so exercise it.  This is human nature.  With this said, a good idea and sound financial assumptions will yield interest and the follow on of cashflow.  Most equity investors back the people and with this the added advantage of good financial plans, you will hit their interest.  BES monies today are still available and BES fund managers do seek companies to invest.

Yourbuiness.ie will ensure the financial plan is solid and will be robust for any scrutiny and due diligence.


Level of funds from Type D
Our two pillar banks (recently announced by the Irish Government in 2011) do offer factoring or invoice discounting.  They have substantial restrictions in terms of the lend-out and also concentration limits.  There are other funders in this area but not widely known.  They have the backing, it is their speciality and also significantly cheaper.  They are the new alternative to this source of funds.


Level of funds from Type E
The traditional lend-out by our main banks.  This form of lending is a problem in Ireland, as all bank managers have been asked to call in unsecured borrowings where possible.   New security is required and the main form of the Irish credit problem for businesses - "banks not lending".   New stress tests and new regulalation hits this form of lending.  Hence the alternative lending and access to new cashflows must be considered as a real option for businesses.

Without ongoing and new access to cash, you cannot grow your business.  It is that simple.

Yoursbusiness.ie can help and provide the financial plan and access to new cashflows for your business.  Call today! (01) 442 9652 or email: look@yourbusiness.ie