KIRKLEES firms have been urged to put their efforts into preserving cash flow.
The first few months of the new year have often proved to be a critical financial struggle for businesses as pressure on cash flow builds to crisis point following the festive season, according to Meltham man Peter Sargent (pictured).
Mr Sargent, a partner with rescue and recovery specialist Begbies Traynor, said: “January is a notoriously difficult month and the first quarter of the year is traditionally a peak period for both personal insolvency and business failure.
“The world doesn’t stop just because it’s been Christmas and problems experienced by business during the winter months can soon escalate. There are still bills, wages and the quarterly rent to pay as well as PAYE and NIC in the middle of the month and VAT due at the end.
“Combined with this, businesses have had to cope with a short trading month in December and often a dip in productivity and turnover in the run up to Christmas.
“This is followed by a start-up lag in the New Year when orders tend to be poor and debtors slow to pay. The result is that many businesses will be facing a severe cash flow nick point that could prove fatal.”
Mr Sargent said: “After tough economic conditions over the last few years, many businesses have no wool on their backs to get through more lean times. Our advice is to face up to the situation and seek professional help as soon as possible.”