The nation’s small to medium firms could soon be doomed with a heightened risk of supply chain disruption, Hitachi Capital Invoice Finance has claimed. It warned that pressure will soon be added on cash flow and that access to funding could become restricted.“For smaller companies, if key customers pull back from orders and credit lines suddenly get pulled, the pressure on cash flow could force a foreclose,” it said. John Atkinson, managing director of Hitachi Capital Invoice Finance, further prompted that after the credit crunch in 2008, SMEs found it much harder to raise finance to fund business strategies and many were forced to put investment plans on hold. “While lending bosses are currently reassuring businesses that they are still ‘open for business’, this position could change if orders begin to stall and supply chain disruption spreads,” he explained. “The explosion of alternative funding solutions in recent years means businesses have more options and should seek advice about how best to use these to bridge any funding gaps and keep investment plans on track.” But before taking action to protect cash flow, SMEs need to look at what financial risks come about based on a variety of Brexit scenarios. Such risks are not always readily apparent but can have devastating consequences if left unchecked.
Read more on the supply chain:
- Good partnerships between companies are vitally important
- Avoiding falling prey to risky invoices
- Suppliers must readily support the long-term vision of buyers
Share this story