Cashflow and costs remain key for SMEs
13 February 2024
We’re not out of the woods yet with regards to tough economic times. What should small and medium sized businesses (SMEs) be currently focusing on when it comes to their finances? Morgan Strong, UDC Finance's General Manager - Commercial, says businesses are telling him it comes down to those two Cs – cashflow and costs.
“What we’re hearing from businesses out there is that one of the most important areas of focus right now is cashflow and keeping your costs under control,” states Morgan. “Businesses who understand their numbers and put the right plans in place to keep things ticking over are more likely to succeed in these tough times.”
Morgan Strong
Big costs to analyse and aim to effectively manage include the likes of fuel costs, repairs and maintenance costs, and interest rates. Some questions SMEs should be asking themselves include:
- Is your current pricing model at the right level?
- Are your repairs and maintenance costs up, and is this a sign that you need to be looking at replacing your vehicles or equipment?
- Have you reviewed your cashflow for the next few months? Make sure you understand your numbers.
- Have you considered shopping around for the best solution for your specific asset finance situation, particularly with regards to loan payments?
There are numerous types of asset loan payments and structures that can be considered for a small and medium sized operator, and a good lender will present the different options available to you. For example, UDC offer fixed and floating interest rates, or a combination of both, as well as seasonal payments and balloon payments.
“UDC offer a range of more sophisticated asset finance products as opposed to just simple term loans”, says Morgan. “We have been supporting many of our customers through this economic downturn with these types of products. Anyone can lend money in good times, but at UDC we pride ourselves on working with our customers, asking questions, and looking for solutions that suit their situation in these harder economic times.”
The team at UDC would love to have a chat with small and medium sized operators and provide them with further information. Contact details for all UDC commercial managers can be found in the asset finance section of the UDC website. The UDC team is located up and down the country, so you can get in touch with your local representative, who understands your region, and take it from there.
This article is a general market commentary and does not constitute financial advice. UDC Finance Limited lending criteria, fees, standard terms and conditions apply to any loan.