The Need to Future-Proof a Small Business Debtor Client.

A cash flow crunch is coming.

⦿ Inflation will continue to sustain iself at much higher levels than 2021.
⦿ Interest rates will rise sharply, attempting to curb high inflation.
⦿ Consumer and investment spending will drop meaningfully.
⦿ Inventories will remain unsold and probably discounted.
⦿ Revenues will reduce.
⦿ Costs will increase.
⦿ Credit facilities will tighten.
⦿ New credit facilities will be difficult to obtain.

Cash inflows will reduce due to the following:

⦿ Falling cash-based sales revenue as consumers tighten their belts.
⦿ Falling credit-based sales revenue as interest rates rise sharply.
⦿ Slower debtor payments.
⦿ Rising bad debts.
⦿ Reduced or sterilized investment spending.

Cash outflows will increase due to the following:

⦿ Higher inflationary costs of acquiring required goods and services.
⦿ Increasing interest costs on borrowings.
⦿ Rising staffing costs.
⦿ Creditors are more demanding and may require cash payments for future orders.
⦿ Possible part repayment required of some debts to reduce Lenders’ risk profiles.

Facilitate Future Proofing your Debtor Clients’ businesses to ensure their debt payment obligations are made timeously in the turbulent times ahead.

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