Why Managing Your Cash Flow is Essential for Alleviating Supply Chain Issues

*This post is from CMB partner Essex Lease. Visit them for flexible lending solutions.

As some question how long supply chain issues will continue to impact our economy, many businesses are actively building strategies to adapt to the challenges.

Rising costs, inventory shortages and unpredictable demand can choke off revenues, quickly making cash flow an issue.

Dealing with challenges like increased costs is essential for long-term success and profitability during uncertain economic times, and a strong cash flow position becomes especially critical if your business is dealing with irregularities.

If you’re facing supply chain stress, here are some tips on how you can better manage your cash flow.

Extend the Useful Life of Your Assets

Cutting costs can be essential for keeping your cash flow normal even when supply chains aren’t.

Flexible solutions like financing equipment repairs rather than buying new equipment at an inflated price can be a smart strategy for businesses looking to save cash.

Re-examine Your Lending Relationships

Given the reality of ongoing uncertainty in supply chains, it’s important to plan for multiple scenarios to understand how much cash you’ll need.

This should be an opportunity to re-evaluate your lending relationships to ensure you have the best possible financing in place.

Get Personalized Advice

Working with a lending partner to manage cash flow should be a two-way conversation.

When it comes to getting the financing you need in an uncertain economic environment, a partner with specialized knowledge of your industry and a flexible, customized approach offers a major competitive advantage over a traditional bank.

Be Prepared to Act Quickly Once Supply Chains Do Return to Normal

While we will continue to deal with uncertainty around supply chains for some time, material shortages, inflation and rollercoaster-like demand will eventually settle down. Are you prepared to scale-up once business does return to normal?

It’s important to have a plan so your business can act quickly in an unpredictable economy. Maintaining a healthy cash flow is essential to staying flexible. If you find yourself in need of better financing solutions, it may be time to look at your options beyond the bank.

If you’re looking for better lending partnerships, Essex is here to help. We specialize in working with businesses to reduce the impact of obstacles like supply chain issues that are blocking their path to profitability.

For over 35 years, we’ve been the trusted alternative to big banks. We’re here for businesses that appreciate flexibility, personal service and a customized approach to their lending and financing needs.

Reach out to us today to learn more or get started.