The client’s business had a cash flow problem. This was as a result of the lockdown in the city of London which is where the business is based. They had benefited from the Bounce Back Loan which on the one hand was good for them at the time, however reduced some of the other funding options they could access. The business needed further quick cash liquidity to cover other operating expenses but didn’t know how or where to access further finance. The business owner was referred to RBSS Consulting by another client we had worked with.
This is what followed
One of the RBSS Business Consultants conducted a full free business diagnostic with the client by way of a Business Health Check focusing on the 5 key drivers of the business: People, Systems, Finance, Marketing and Operations. This was to enable us to understand and address any underlying issues besides the cash flow issues and enable the business to be more profitable and viable especially when faced with the challenges of the coronavirus pandemic. This enabled us to come up with a number of workable plans and solutions which related directly to his business. We drew up a report and discussed this with the client and embarked on the preferred option.
Whilst we couldn’t get the business owner all he wanted, due to other financial challenges their business had, we were able to help the business access the needed funds through an additional cash advance of £20k through a Merchant Cash Advance (MCA). This is unsecured and we got it in record time for the business. With this, he was able to:
Make stock payments which were overdue and buy the additional stock required in cash. Most importantly, the repayment of the loan was tied to his monthly revenue as opposed to being fixed. The flexibility of this method meant it was very affordable for the business without acquiring unnecessary debt and being able to attend to other monetary requirements. There were no personal guarantees or security against the proprietor’s property or assets and the interest rates were fair and acceptable.
Whilst £20,000 may seem small, it was what the business needed to bridge the cash flow challenge it had at the time. Businesses don’t always fail because they are not a good idea nor because they are not profitable, but often because of cash flow problems. We stopped that failure and put the business on the right road to thriving again.