ENTREPRENEUR and TV Dragon James Caan says small firms should explore alternative funding mechanisms to ensure they are not left with cash-flow problems.
He urged businesses to take care of the basics such as invoicing accurately and on time.
“They are also to ensure that your quote has been accepted, the product or service delivered and the terms and conditions of payment agreed in advance,” he said.
“If you do nothing else but stick to these simple rules, then your business will not only survive, but it will actually have every prospect of growing and contributing to the economic recovery that we so dearly seek.”
Mr Caan, who was sharing his wisdom in a guest blog for the Institute of Credit Management (ICM), said that alternative funding mechanisms such as factoring and invoice discounting rarely deserve the negative publicity they attract.
The ICM manages the Prompt Payment Code (PPC) on behalf of the Department for Business, Innovation and Skills (BIS) and also produces a range of Managing Cashflow guides for the Department.
The guides have now been downloaded more than 400,000 times. The most popular of the 12 is the Payment Terms guide.
Philip King, ICM chief executive, said: “Demand for the Payment Terms guide has almost doubled in the last year. This provides proof businesses are already focused on keeping the cash flowing and seeking professional advice wherever it is available.”
Mr King is also a member of the board of Start Up Loans, the Government’s latest vehicle to provide young and emerging talent with access to start-up capital. Mr Caan chairs the organisation.