Well established Midlands family business, engaged in civil engineering contracts, with a blue chip customer base, hit an unforeseen cashflow crisis and needed rapid advice.
Summary
Well established Midlands family business, engaged in civil engineering contracts, with a blue chip customer base, hit an unforeseen cashflow crisis and needed rapid advice
Challenges
- unfavourable changes in customer contract terms
- a delay in the start of a major contract
- serious cash issue; no contingency plan in place; left late to seek professional help
- real lack of understanding as to how this would be perceived by bank
- management had not anticipated any difficulties in the Bank covering what they saw as a temporary excess; strained relationship ensued
How we helped
- obtained rapid understanding of the cashflow, including potential upsides, downside risks
- reviewed forecasts and provided feedback on longer term viability
- supported Board with stakeholder management and guided them through the business support banking aspect
- aided provision of reliable information to the Bank so that the request for support could be considered
- presented options to management, for a more appropriate forward funding structure
Results
- Bank satisfied this was a temporary cashflow issue, and supported the increase
- in addition a Government backed loan was secured
- agreement reached on a plan to address longer term funding structure, better suited to the evolving business needs
Benefits at a Glance
- short terms problem solved
- longer term plan put in place
- Banking relationship restored
- management team strengthened and now better equipped for future challenges
- business back on track and growing
- shareholder value preserved