Health authorities and governments across the world have staged an all-out assault on the ongoing global outbreak of coronavirus (or COVID-19 as this particular strain is called). There are some promising signs already: new coronavirus cases have plummeted in China and South Korea’s health minister said the country has “passed the peak” with the illness.
There remains, however, tonnes to do. Italy has now gone into full, nationwide lockdown and similar quarantine measures could be introduced in the UK if the outbreak worsens. The economic impact will likely be substantial.
Cashflow and corona - making your business virus-proof
Businesses need to brace for cash flow and liquidity problems due to halted production, supply issues and changing consumer behaviour. That, of course, is easier said than done. These are quite exceptional circumstances.
Orders are lower, people are late paying invoices, events are being cancelled, stock from abroad is at risk of not arriving. Many businesses are paying for supplies earlier than anticipated because of stockpiling and fears of deeper disruptions to transport linkages.
This disruption won’t last forever, though. In the meantime, finance teams and founders should keep a close eye on cash flow and, if needed, assess the different credit facilities available to manage the impact. A revolving credit facility could be a good option.
Corporate revolving credit facilities can provide liquidity for your day-to-day operations. These types of loan offer the flexibility of an overdraft but with no fees or commitments. You only take out the funds you need – if you need it – and pay what you need.
That sort of flexibility is priceless during uncertain times like these. With a smart approach to credit and the right lender, you can approach any quarantine scenario or economic slowdown with some security and confidence.