Even if the start of the tax year doesn't align with the calendar, as a new year starts for companies many business leaders might make a resolution or perhaps just a wish for 2020.  The received wisdom over the last year or so has been that the wish would be for certainty and the resolution to invest for growth. However, the situation remains unpredictable and many firms will also be thinking about managing their cashflow so they can take advantage of trading opportunities - whatever happens.

In fact, many small and medium sized firms have an agility that a large company just can't match and ensuring your resources - people, systems and money - give you the flexibility to adapt could be the basis for the next stage of growth. Whether it is purchasing stock, accepting a big new order, expanding overseas or renting some extra space, a business is likely to need headroom in their working capital. SMEs have record levels of cash, so many will already have the headroom. For other firms, with overdraft utilisation of around 60 per cent, they may be able to draw down against their facilities. However, for some of our most ambitious companies, their limits could easily be reached if they don't plan in advance and consider a wider range of options.

Invoice finance is probably the most flexible tool for a firm with a strong business customer base paying on deferred terms. As sales grow, the beauty is that the available funding grows and clients of invoice finance providers also have real experts in managing cashflow and credit at hand. And, as the statistics that UK Finance publishes show, growth in the facilities has been notable particularly amongst those medium sized businesses that Germany has been so famous for; their Mittelstand. Finance providers can provide funding with the backing not just of debtors or monies owed on sales, but against inventory and other assets too. So called asset based lending is huge in the US and has been growing rapidly here too.

My personal resolution is to work with colleagues here and leaders across the industry to grow the number of firms using this great form of finance, and help the economy grow in 2020, including in international markets around the world.

My personal wish though is that we continue to have a policy environment that supports this great industry. One worry has been the potential impact of the mooted return of secondary preferential creditor status for HMRC (commonly known as Crown preference). If a finance provider is uncertain as to what is available as collateral where tax liabilities could leap up the pecking order, it just won't be possible to provide the level of advance required. In an uncertain trading environment, now is not the time to be squeezing out flexibility.

If this topic is of interest, please find details here on an upcoming CRD IV half-day workshop for SMEs coming soon.