Who can you lean on in a business cashflow crisis?
These two businesses have very different stories to tell, but both survived major business cashflow problems by leaning on the right partners. Read on to find out how or call Unique ID:321148/08000294864* to discover how our cashflow solutions can best support your business.
DPM Design & Build Ltd – Their story
On 27 February 2020, entrepreneur Marius Visser registered DPM Design and Build Ltd with Companies House. Three weeks later, the UK locked down in response to the global coronavirus pandemic, putting Marius’s new business in real danger of going under.
It was a cash flow nightmare and I couldn't see a way out
"I'd bought supplies for a couple of big jobs when lockdown hit and merchant yards closed down. My cash and my supplies were locked behind gates and without them I couldn't finish jobs and get paid. It was a cash flow nightmare and I couldn't see a way out."
Marius quickly realised that there was no government support available for his fledgling business (it was too new). He had a lot of self-employed people contracted to him and relying on him for work and income. It was a situation sadly familiar to many independent business owners.
When a fellow small business owner recommended asking Barclaycard Business for help, Marius turned to us straight away.
Business Relationship Manager, Dee Betts, was at the other end of the phone:
"Marius got in touch to explain he had goods and cash stuck with suppliers, which meant he couldn’t complete jobs and invoice for them. I'm so pleased we could help him with a business credit card, to ease his business cashflow issue and keep DPM Design & Build Ltd up and running."
Having been a Barclays and Barclaycard customer for more than 10 years, Marius had complete trust in the heritage of the brand:
“There's every chance I'd have lost my business without help from Barclaycard Business, and from Cartley Landscape Supplies. They were so kind and really threw us a lifeline by opening their yard and letting us have supplies on credit.”
There's every chance I'd have lost my business without help from Barclaycard Business
Marius has since paid Cartley Landscape Supplies back in full, and cannot stress enough how important it is to build and maintain good relations with your supply chain.
Since his very early business scare, Marius is relieved that business really picked up and he’s expecting to turn over in excess of £400K in the 12 months from May 2020.
During lockdown, more than half of DPM’s jobs were put on hold, particularly the indoor ones like bathroom remodelling. On the other hand, a lot of people realised they want to entertain in their gardens. Which meant DPM was flat out building BBQ areas and pergolas, landscaping gardens and launching their new artificial turf division – Home Counties Turf.
So, not only has the business survived a near-fatal cash flow crisis, but it has diversified and continues to thrive and have a positive future.
Crowdify Global – Their story
Serial entrepreneur James Rix, found himself down £50K a week across his group of businesses:
“It was a heart in the mouth moment. I could’ve lost everything I’d worked my whole life to build.”
But he stayed focused, and realistic, sharing that at that moment he realised two of his businesses would probably go under, but one had a real chance to shine.
“I spoke to my mentors and owners of competitive businesses every day at the start of lockdown. We shared feelings, ideas and views of the future,” said James.
“I was also really glad to have built strong relationships with suppliers and partners, like Barclaycard. We used our Barclaycard business credit card to not only manage cashflow at the beginning of the pandemic, but also to invest in the business, for the future.”
So far, we’ve used our credit card to pay to set up our new venue – Knowhere Special. The future is looking bright again
This diversification and adaptation means StreetPR, Rix’s promotional staffing agency, and Wicked Student Nights, can take a back seat while the events industry recovers. The first runs on small margins and huge overheads, and it was owed £60K. It took another £30K hit when Rix paid his staff, despite not being paid by clients. The second, on the other hand, is a cash-rich business – that has the reserves to last a year closed, with staff furloughed.
With these two businesses out of action, Rix grouped together his ‘A team’ – specialists from across his group of companies, to work at Crowdify Global, his digital marketing agency. In just three months (April to June 2020; during lockdown), Crowdify’s revenue sky-rocketed, by 670% - from £7K a month, to £54K. Just under £30K a month comes from around 20 retained clients, and the rest from one-off projects that Rix says, more often than not, lead to retained work.
Interestingly, this growth not only comes from companies realising the huge potential of selling online, but also from wholesalers becoming customer facing. The latter is a particularly interesting shift, with wholesalers losing revenue from physical stores that had to pull down the shutters during the coronavirus lockdown. With the opportunity to sell directly to customers online, Crowdify’s expertise (in bringing brands up to date and focusing on returns from paid advertising and SEO) continues to be in huge demand in this area.
I can’t thank my customers and team enough for the incredible hard work they put in every day to make Crowdify, and our other companies a success
- *All stats referenced in this article are from the same source (unless otherwise referenced): Research was conducted online by YouGov on behalf of Barclaycard between 1 – 21 April 2020. YouGov polled 576 senior members of staff working in UK SMEs, weighted by region to reflect SME distribution in the UK. This data has been compared to Barometer data, run by YouGov with 562 senior members of UK SMEs between 10 – 24 January 2020.
- 1Taken from Barclaycard Payments proprietary data on 9 July 2020.