Finance

Tougher market conditions are predicted, with UK economic growth potentially slowing or even reversing. What lessons have you learned from similar previous scenarios that you can use now?

Forecasts vary dramatically for the exchange rate and will continue to go up and down throughout the transition phase and beyond. This may be beneficial or detrimental depending on your specific business model.

Delays or distress in the supply chain may lead to problems in recovering cash from customers, putting pressure on your cash flow position. Some organisations are seeing extended payment terms being introduced by key customers, which is putting pressure on their cash positions. Without sufficient cash it may be unable to fulfil orders, pay staff or other bills.

Margins may be eroded by changes to currency values, the introduction of tariffs, customs administration, rising labour costs and other drivers. While each may be small, taken together the impact could reduce the viability of a business.

Understand your financial limits and how bad conditions can be for your company to survive. Use this as a reference point for future decisions.

Having cash ready to use can shield against any harmful trading performance impacts. It also provides flexibility to seize unforeseen opportunities.

Save money by cutting any unnecessary spending.

Communicate with any important stakeholders, and bank managers in advance of any financial problems. This will give stakeholders confidence that you are proactive and able to respond to any challenges that arise.

Chase up any overdue payments and find a contact in their accounts department to build good relations.