Finance Management: tips & solutions

You firmly believe in your plans. So strongly, in fact, that you are prepared to take financial risks to do so. That makes you an enterprising manager. But smart management also involves seeking protection against (unnecessary) financial risks. We are happy to help you with this.

Finance management refers to everything to do with a company's finances. This ranges from analysing your company's financial results to choosing the right financial KPIs and obtaining financing or investment.

It is crucial that finances are managed by the right manager. That way, profit maximisation, future-proof financial decision-making and maintaining good cash flow are guaranteed. All this is necessary to ensure that all operations and expenses can be paid for.

There is no such thing as entrepreneurship without risks. As an entrepreneur, you calculate them. For example by listing the risks and taking measures for them. Think of the damage insurance you take out. The trick is to avoid surprises. You want your company to get from A to B. Ask yourself what risks you might encounter on the way and what you can do about them. For instance, by instructing your employees or adjusting procedures. Financial risks can also be anticipated.

What financial risk your business faces depends very much on the type of business. To mention all the risks here would be too complex, but we list some key risks:

  • Liability risk. What if you or one of your employees causes damage to others? Then they can recover the damage from your company. Many companies cover this risk with liability insurance.
  • Internal and external fraud. Whether the fraud is committed inside or outside your company: financial losses usually have a major impact on your business. This risk can be covered with fraud insurance.   
  • A risk you opt for as an entrepreneur is that your income is uncertain. Disappointing sales and economic developments are part and parcel of doing business. It is often a conscious choice you make and one you anticipate as an entrepreneur.

Almost every growth plan requires an investment. Maybe you need to buy new machinery or software. Maybe you need extra staff or bigger premises. Maybe you need to advertise and have a new website created. The question is whether you have your own money to do that or whether you need financing. Perhaps there is still room in your working capital? But be careful not to run out of cash. That would put pressure on your existing business.

Keep an eye on your cash flow

Even if you are profitable, you can become insolvent if your cash flow is disrupted, for instance when customers don't pay your bills on time. It is important for the overall health of your business, but also for your external financiers, that your cash flow is in order. If this is not the case in several periods, you need to work on the causes of the negative cash flow. This can be done, for instance, by increasing your prices or getting your debtors to pay faster and better. Timely intervention is the general message, as cash flow is and will remain the lubricant of any business.

Different ways to access finance

One of the most important tools is maintaining a relationship of trust with your bank. For this, you need to clearly explain the nature of your financing and how you generate profits and protect your margins. Being able to demonstrate sound financial management can be advantageous when negotiating with your bank. You might also consider taking out credit insurance. Many banks see this as additional security.

Trade credit insurance as a tool for your financial management

We monitor the financial situation of your customers and prospects. We share this information with you.
Is a customer not paying? Then our collection team will work for you to still collect your money.
If we also fail to collect your unpaid invoices, we will compensate you for the loss.