Over the past decade in which we have been managing insolvency events and corporate restructures for business owners, two points have become clear:
If proper asset protection has been put into place, the outcomes have been greatly improved in an insolvency event. “It's cheap insurance.";
Having cash flows aligned with the business’s working capital requirements is paramount to a business’s long term success and growth.
With this in mind de Jonge Read have been a strong advocate of the correct use of debtor finance products in conjunction with asset protection strategies. Debtor finance which is at the core a line of credit secured by outstanding sales invoices can facilitate a number of strategic outcomes.
Debtor finance is ideally suited for:
Supports businesses in the start up and early growth phases. Debtor financiers are more concerned with the future than the past and do not place the same reliance on historical financial performance and information.
Fundamentally good businesses recovering from a specific issue that has had an adverse impact on their cashflow, such as a bad debt or a loss of production.
Debtor finance facilities are stand alone, being secured by the invoices raised by the business itself and can therefore be used to complement or repay traditional bank overdrafts potentially freeing up real estate property (importantly the family home) from the security mix.
Can be used to support businesses through a formal restructure process including Administration and Deed of Company Arrangement (DOCA) where necessary.
Capital finance solutions? Done.
We provide capital finance solutions that are individual and grow with your business.
Most businesses experience working capital issues and in some cases, a Debtor finance facility may be the solution.
If you have existing lending supported by brick and mortar security and are unable to source further funding for working capital through your own bank, or simply choose not to, de Jonge Read Strategists can put in place specialist Debtor finance packages where bricks and mortar security is not required.
The benefit of having a de Jonge Read Strategist provide this product is that we understand business structures, asset protection, turnaround management, traditional banking policies and the PPSA system.