Finance for Businesses Hit By Carillion
Is your business suffering due to the collapse of Carillion? We are expecting the impact to be far reaching and the businesses that suffer will not just be the ones owed money directly by Carillion. The impact will be much farther reaching right through the supply chain.
So what could be the impact?
It is important to remember that if you have suffered a bad debt there could be 3 major impacts.
1) Your profit and loss account will be hit with the bad debt.
2) Any losses will impact on your net worth on your balance sheet.
3) The more immediate effect will be the impact on your cash flow.
The cash flow impact on your business needs to be monitored carefully. The amount of any bad debt will be the obvious impact but if your customers are also part of the Carillion supply chain there could be further problems.
Another side effect could be the attitude of any existing lender when it come to the change in profits or net worth of your business. If your business suddenly does not meet the lenders criteria might they reduce or indeed pull your funding altogether?
The high street banks have allegedly set aside funding specifically for firms hit by Carillion. Albeit the only real difference I can see from normal lending is that arrangement fees will be waived for businesses that have been hit by Carillion. The security requirements and no doubt the financial performance criteria will remain the same. As such I am not sure the banks will be stepping into the breach simply to plug holes created by bad debts and supply chains with liquidity issues.
At Funding Solutions we have a variety of solutions that can help with any cash flow issues. We have solutions for loss making businesses and often help businesses that have been hit by bad debts. We understand that while there may be a common cause for cash flow issues at the moment within the construction sector, the challenges you face will be unique to your business. We are here to listen and to offer honest advice as to what your options are no matter what issues you may be facing.
Get in touch on 0845 251 4040