Every business goes through a lifecycle of highs and lows – and each has the potential to be extreme. Risk and operations director at IGF Matt Smith explains
As such, it makes sense to have a flexible funding source that can accommodate whatever challenges come their way.
Every finance provider will be familiar with the tell-tale signs of a business approaching a downward slope, most notably the deterioration of financial information through what is being reported, delays in submitting papers, or just going silent.
In these instances, a provider has to work hard and sensitively ask the right questions and extract the required information.
Of course, building a strong relationship with customers through personal service and an in-depth understanding of the client’s needs will help avoid these potential difficulties in the first place.
Businesses that have a trusted relationship with their finance provider are normally much more comfortable having difficult conversations and volunteering tough information.
As such, companies should look for evidence that a provider will not just respond with a knee-jerk reaction, but instead listen to them carefully, consider their best interests and support them through the good times and the bad.
Ultimately, every business is on a winding road, and likely to encounter a few bumps and crashes along the way.
However, for the most part, few companies experience a total write-off; a reliable finance partner should have the business acumen to understand this dynamic landscape and reflect it in their offering.
In some instances, finance providers will be able to spot signs of trouble before their client. At this point, the right provider can provide extraordinary value by sharing the information and expertise with their client in order to avoid any major business problems.
This flexible approach can also help business to benefit from increased finance options as the company grows, such as an extension in facilities or even an introduction to mainstream finance, which may have previously been unobtainable.
Whatever stage in the business life-cycle a company may be, there are always financing options available.
However, these can best be identified when a finance provider understands the market and has fostered an open and honest line of communication with their client.