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Postern Cash Management

Generating Improved Cash Flow in a Business

Cash Management 

  • Developed from expertise gained from many small, medium and large company transformational and improvement assignments
  • Our experience is extensive as many of our assignments often come to us when a company has raised new capital or is in need of more capital or has had acute cash-flow problems
  • Postern operates its own proprietary systems for cash management, and then provides training for client staff as and where necessary 

 

Management can once again concentrate on the issues that led to the cash problem free of distraction and in order to maximise their operations.

Ways that Postern will seek to improve cash generation for a client:

1. P&L

  • Optimise unit selling price
  • Seek brand leverage to increase market penetration and margin
  • Improve procurement performance to increase gross margin and creditor terms
  • Apply solid process engineering to optimise productivity
  • Seek to invest capital spend in projects with
  • Apply most relevant cost out options via efficiency tools such as 6-sigma, continuous improvement Kaizen, etc.
  • Reduce peripheral labour costs (overtime, lost time, etc)
  • Fix non-optimal supply chain/logistics inefficiencies in planning, R&M, contract overruns in vehicle hire, etc.
  • Re-structure organisation so that all roles are direct value added to the operation, or only one removed, adding direct value to the direct value add roles.

2. Balance Sheet

  • Extend credit terms with supplier base 
  • Shorten client credit terms 

  • ‘Spring Clean’ old stock and realise as much cash as possible 

  • Optimise stock turns to minimise holding and release cash 

  • Review contract out/buy assets policy

3. Cash Flow Statements

  • Set up and operate 13 week rolling cash flow forecast by day: setting extended targets for cash exhaustion day into the future. 
  • Review capital spend and focus on ROI projects plus ‘legals’ only for an initial period 

  • Assess debt position, interest paid and potential for re-financing 

  • Assess need for factoring for short term cash flow versus cost. 

  • Assess key creditor positions such as landlords, HMRC, banks, raw material sell back/consignment stock options etc. and re-negotiate more favourable terms.