Are your near-term strategic and operating goals aligned with your current financing 
capacity? Some companies are fortunate enough to be self-funding through their internal cash flow. While for some, self-funding is ideal, there are others who for various reasons, find that this is not the case.
What happens if your receivables aren’t turning into cash fast enough to afford the growth that you have outlined for the New Year? What will you do if an opportunity arises and there is just not enough cash available to capitalize on it? What if you are the type of company that can’t easily use your receivables as a viable option for funding?
In our last article, we discussed various options for middle market funding. There is a lot to consider, and the variety and scope of those choices might get a little confusing. If you are considering any of these lending programs, you might want to ask the following questions to help narrow down the perfect financing pathway for your company.
Have you considered whether your current availability of capital is adequate to accommodate your near-term operating plan or to take advantage of a high-probability growth opportunity? It is important as you look forward to your projected plans for the year that you are aware of your current capital, and that you know exactly what is available. It’s helpful to have a backup plan so that lack of funding does not prevent you from seizing an opportunity that could take your business to the next level.
Is your current credit facility/borrowing base priced at market rates based on your recent operating performance? It may be possible to get better rates than you have had in the past if you know the players in the capital markets that could best meet your needs.
Are there any projects related to your near-term strategic plan that might require a unique debt structure or equity investment? Our last article mentioned some options wherein new debt structured properly can finance your project. Being in a position where you have access to this capital can help ensure that you are able to follow through with those plans.
Do you need to consider restructuring your existing debt due to unforeseen events and circumstances? If you are dealing with a slowing market and some of your vendors are slow to pay, you may need to look into this option to keep your company solvent.
These are a lot of questions to consider, but here at PCG, we are pleased to be home to many CFO Advisory professionals who will sit down with you, face-to-face to discuss potential solutions to your unique capital requirements so that you can keep your business running smoothly while also meeting the capital expenditure needs that will allow you to execute on your growth plans.