THE INTERFACE FINANCIAL NEWS November 2008
THE RIGHT ALTERNATIVE FOR TODAY'S MARKET According to recent research, the environment for small business funding and cash management has never been more difficult. Recent debtor payment surveys show a very gloomy picture: Dun & Bradstreet survey for the September quarter measured average debtor days at 50.2 - easily the worst since these surveys began. It is not just small companies - the large company average was 48 days. Remember this is the average! Veda Advantage report that 41% of small businesses are now taking an average of 23 more days than a year ago to settle their debts. The problem is - it was not great a year ago! Major trading banks have been seriously affected by the recessionary economy. Write- offs for bad loans are at high levels with the expectation of more bad news to come. One can be sure that it is more difficult for small businesses to obtain working capital/overdraft funding from their bank today than in 2007. To complete this ominous outlook - company liquidations and mortgagee sales are at levels not seen for many years. The good news is that there are still many well managed companies doing good things for the economy. On top of this, the invoice discounting services of Interface are very busy - and ready and able to do more to assist the working capital needs of small businesses. The key message from Interface is simple. Don't leave it too late to consider alternative funding options. We see too many companies that have done just that. They get seriously behind with key creditors and hope that their bank will extend a further friendly hand, only to be disappointed. Discounting a few invoices to get some ready cash is a far better solution to going out of business. If the future for working capital looks difficult, consider the options today so remedies can be put in place quickly. Often, Interface can provide the answer that you are looking for. IFG HELPS TO DITCH THE OVERDRAFT Soon after Sundial, a Wellington human performance business, made the bold decision to drop their overdraft, they hit cash flow problems. The lengthy consultation process needed to improve employee performance meant they were left with big gaps where they received no income. With immediate debts to pay, managing their cash flow became difficult. For the first two months IFG helped keep the business afloat through purchasing a number of invoices. They now maintain a healthy cash flow through occasionally selling small invoices. The flexibility of the IFG service meant that the Sundial Group were able to achieve their goal of managing overdraft-free. Not a typical case, but the client is far happier without the stress and commitment required by an overdraft. This is just another good example of how IFG is helping small businesses reach their goals. THE INTERFACE SOLUTION: - no set up cost - no contracts to sign - cash in your account in 2-3 days - proven cost effectiveness - flexible - use when you need it TRUCK ACCIDENTS CAUSE CASH FLOW PROBLEMS Truck accidents are a serious matter for haulage contractors. Aside from the major safety issues involved, there are serious business issues too. For one Levin based operator, 3 trucks rolling in consecutive months put a major hole in his cash flow. He was referred to IFG by a large factoring company that was unable to help him. We have so far funded over $280,000 of working capital to this business. This has allowed the operator to keep himself in business, keep the trucks running, and gradually work back to a position of stability. RECENT TRANSACTIONS Landscape Contractor - Otago $56,000 Food Manufacturer - South Auckland $16,500 IT Provider - Auckland $48,000 Transport Operator - Levin $55,000 Corporate Taxi - Whangarei $39,000 Personnel Consultans - Wellington $14,500 Clothing Wholesaler - Hamilton $81,000 www.interfacefinancial.co.nz Our website is continually being updated. You will find some interesting Case Studies on the newly created page.
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