The 29th March is getting close and with the clock ticking we want to understand what it is going to happen to SMEs after Brexit. Whilst the Prime Minister Theresa May is still dealing with Brussels, UK companies are afraid that a “No-deal Brexit” would trigger a lengthy UK recession. A CBI survey on Brexit shows that more than 50% of businesses examined different Brexit scenarios and more than 60% developed contingency plans in the event of a no concrete agreement. To prevent and protect SMEs from a potential post-Brexit crash, here at Peak Cashflow, we wanted to discuss the 3 best solutions which could help your business keep a strong economy:
Use invoice finance
UK SMEs will need to find quick and accessible ways to acquire and maintain healthy cash flows, source new suppliers and access funding facilities that help pay unexpected tariffs, charges and taxes. Invoices are a prudent alternative way to ensure working capital stays steady. As we already said in our latest blogpost, from the 1st April 2019, businesses will also be required to keep their records digitally, including their invoice finance. HMRC confirmed that Brexit will not affect the introduction of Making Tax Digital for VAT (MTD for VAT).
Use asset based lending
After Brexit, if your business requires higher levels of funding to become bigger, an asset based lending facility could meet your needs. Asset based lending combines invoice finance with cash flow loans and makes extra funds from other assets, such as stock, machinery and property. When a company can use their asserts as proof they can afford repayment, the facility can be more flexible than a traditional loan or overdraft
Ensure you are prepared for bad debts
During political and economic challenges, late payments and unpaid invoices increase, having a huge impact on a trading chain. If your customers and suppliers don’t pay, your business risks an economical collapse. If you don’t know how to prevent this situation, experts at Peak Cashflow are always ready to make your business grow and help minimise your exposure to bad debts.
A single company may have to consider potential Brexit impacts on its employees, trade, compliance, strategy, structure and more, with no certainty about the future for any part of the business. If you want to prevent all these threats and figure out what Brexit really means for your business, feel free to visit our website or contact us.