Crisis cash management

In troubled times, even the most profitable business can swiftly become unsustainable if cash controls are weak and visibility over cash is limited. At a stroke, financial institutions adopt stricter conditions for funding. Robust, sustainable crisis cash management buys valuable breathing space to restructure and/or refinance. In the longer run, an improved cash flow can reduce debt, fund growth and provide better stakeholder returns.

In a crisis like COVID-19, your business may have limited time under existing financial arrangements. These seven steps can help you gain time to stabilize:

1. Improve visibility of funding requirements through robust short-term cash flow forecasts
2. Identify and implement `quick wins' to generate trapped cash or preserve cash
3. Establish tighter controls over cash and bring in cash-related KPIs  - to seek to reduce leakage and adapt to changing lender requirements
4. Develop short-term tactical liquidity strategies
5. Manage communications and interactions with relevant stakeholders (lenders, suppliers, landlords and tax authorities) e.g. build facility headroom or incremental financing
6. Rebuild trust with stakeholders to support sustainable restructuring
7. Rapidly explore alternative financing options with investors/financiers

As times of uncertainty can be difficult to navigate, please contact Angel Martin Torres or one of our advisors for more details or help to guide you through the processes.