Managing cash flow key to survival for Hampshire firms

Hampshire businesses are being urged to review their cash flow and credit control procedures to ensure they are in the strongest possible position, following the news that discount fashion chain Peacocks has become the latest high profile firm to go into administration.

“The current economic climate means that credit control, and the chasing of unpaid debts, represents an ever greater issue for businesses,” explains Peter Worrall, debt recovery manager at Moore Blatch.

“Many businesses need to adopt new practices and a focus in respect to credit control, to ensure that they do not become a victim of the economic climate.”

Staff employed at the 13 Peacocks stores in and around Southampton now face an uncertain time, but the demise of the chain should come as a ‘wake up call’ for many Hampshire firms, adds Peter.

He says: “We work with a lot of businesses where we see the same mistakes being made and the signs of trouble are overlooked. Taking appropriate steps early on can help, as if the decision to pursue the debt is taken later there are often few assets left to recover.”

Peter’s tips for protecting cash flow are

• Due diligence - When starting work with a new client undertake appropriate due diligence as to their financial means, assets and credit risk. This is one practice which can really pay in the long run.

• Spot the signs - Failure to satisfy an outstanding debt may be the first sign a company is struggling. This should be acted upon immediately and strong attempts made to recover any monies due. You should also consider putting a freeze on any further work or further credit for companies who fail to meet their invoices.

• Bad debt – Closely supervising your own credit control procedures can help reduce the risk of needing to write off ‘bad debts’, which in turn could leave you facing difficulties of your own.

The debt recovery team at Moore Blatch settles 98% of claims within seven days without the need for court proceedings, usually by obtaining arrangements for payment of the full amount of the debt.

For more details visit www.mooreblatch.com