Cash flow hiccup | Fin24
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Cash flow hiccup

Apr 16 2013 07:46

After 35 years in business, the owner is now facing a cash flow hiccup and is wondering where to turn to. He writes: 

My Business H. Delahunt Pty Ltd requires additional finance. 

It is in existence for 35 years and because of a forced move of premises and late shipment last year we now have a cash flow problem. 

Standard Bank has approved R1.5m but I think their costs are expensive. Can you suggest other companies for finance? 

Business development consultant Anton Ressel responds: 

My first suggestion would be to approach the other banks and see if they can better the offer from Standard Bank - loyalty to a bank is only justified if they are also giving you a good deal. 

You could consider selling a small stake in the business to raise the capital as well, or approach the existing shareholders and see if they could not raise the necessary working capital between themselves at a more favourable rate? 

Finally, you might try SEFA, the IDC or an industry-specific fund (I am sure there are several), but this process, while cheaper, usually takes some time.



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