Advise on Small company Cash Flow Issues and Debts

Discussion in 'Cashflow forum' started by Jayman21, Dec 6, 2017.

  1. Jayman21

    Jayman21 UKBF Contributor Free Member

    35 1
    Hello All,
    Need your input. Currently going through a period of cash flow issues as work has not come in for some time now. Work as a small management consulting firm (with focus around software and websites). I have exhausted the company over draft and borrowing money into the business from my personal account (which is now exhausted). With more bills to pay is it advisable to seek a company loan to keep going? What advise can you give.

    In regards to seeking work we have been working on tenders and trying to seek new clients but is very small and yielding mush results. thanks
     
    Posted: Dec 6, 2017 By: Jayman21 Member since: Feb 25, 2015
    #1
  2. Mr D

    Mr D UKBF Legend Free Member

    7,080 745
    Can you cut any of your business expenses?
    Can you change the way you try drumming up business?
    Can you expand your range of services to bring in new business?

    I'm guessing a few months without work is unusual.
     
    Posted: Dec 6, 2017 By: Mr D Member since: Feb 12, 2017
    #2
  3. Scalloway

    Scalloway UKBF Legend Free Member

    13,121 2,831
    You are in danger of trading while insolvent. I wouldn't dig a bigger hole by borrowing more money.
     
    Posted: Dec 6, 2017 By: Scalloway Member since: Jun 6, 2010
    #3
  4. Mark T Jones

    Mark T Jones UKBF Enthusiast Free Member

    1,777 468
    As has Been said borrowing now would basically be throwing money into a black hole

    How about temp/agency work?
     
    Posted: Dec 8, 2017 By: Mark T Jones Member since: Nov 4, 2015
    #4
  5. Jayman21

    Jayman21 UKBF Contributor Free Member

    35 1
    Thanks all for your contributions. These are very good points I will have to review. Thanks
     
    Posted: Dec 10, 2017 By: Jayman21 Member since: Feb 25, 2015
    #5
  6. hayley Chiba

    hayley Chiba UKBF Newcomer Free Member

    1 1
    Sometimes it is worth considering other routes to customers. When I first started my consultancy business, I worked as an associate to a larger more established firm. The pay wasn't as good but at least it helped me to break into the market, work with some clients and have some case studies to talk about. I only needed to do this for about 6 months before I was able to get my own customers but it was effective in enabling me to gain experience and confidence in the SME market. Good luck with the new venture!
     
    Posted: Dec 17, 2017 By: hayley Chiba Member since: Dec 17, 2017
    #6
  7. Mags Zomer

    Mags Zomer UKBF Newcomer Free Member

    1 0
    I would not take more borrowing as risk is too high and you might not get the best deal in this situation.

    Did you try crowdfunding or grants?

    Maybe you could review your business plan and try to extend the range of service and go for something more desired?
     
    Posted: Jan 5, 2018 By: Mags Zomer Member since: Jan 5, 2018
    #7
  8. Chris Ashdown

    Chris Ashdown UKBF Legend Free Member

    9,136 1,861
    Don't take out more money

    Look to your past customers and give them a reason to put your company forward to others for a commission or prize
     
    Posted: Jan 5, 2018 By: Chris Ashdown Member since: Dec 7, 2003
    #8
  9. Jayman21

    Jayman21 UKBF Contributor Free Member

    35 1
    All valid responses. Thank you. Will keep you posted on how we go. We are currently redefining our service offerings and speaking to few clients. Thanks
     
    Posted: Jan 12, 2018 By: Jayman21 Member since: Feb 25, 2015
    #9
  10. Freelanzguy

    Freelanzguy UKBF Newcomer Free Member

    14 1
    Hi Jayman21,
    I hope it is all working out well.I was originally freelancing as well and getting work from smaller companies. I then pivoted into contracting for larger companies - which brings in steady revenue and has enabled me to build up a cash reserve in the company. Now I can get back to working with smaller companies and build a sustainable business knowing I have some time before cash runs out.

    So I agree with the above comments of temp/agency work or working with a larger firm.

    Good luck
     
    Posted: Feb 9, 2018 By: Freelanzguy Member since: Feb 9, 2018
    #10
  11. Daugela

    Daugela UKBF Contributor Full Member

    82 11
    I agree with the advice above, maybe picking up a part time role alongside your business and trying to reduce business expenses rather than going into debt would be a more sustainable solution.
     
    Posted: Mar 10, 2018 By: Daugela Member since: Jul 15, 2017
    #11