Financial Advise for a 100M+ export business
Hi guys,
I’m a 27-year-old export business owner. Over the last two years my business has grown roughly 100% year-on-year. Last year my turnover was PKR 79M, and this year I’ve already done around PKR 60M, so I’m expecting to cross PKR 100M+.
The biggest challenge I’m facing now is managing cash flow.
My industry works heavily on credit terms. Customers place large orders, production can take around 2 months, and sea shipping can take another 2 months or more before I receive full payment. On the other hand, my local suppliers want payment much sooner. Currently I get around 40-45 days of credit from suppliers, but that doesn’t cover the full cash conversion cycle.
My monthly business spending is usually PKR 7M-9.5M, with even a slow month being around PKR 6.5M.
For those who have scaled businesses in a similar situation:
- What systems do you use to manage cash flow?
- How do you forecast cash requirements months in advance?
- How do you match receivables and payables effectively?
- What financing options or credit facilities should I be looking at?
- How do you negotiate longer credit terms with suppliers as your business grows?
I’m less worried about sales growth and more concerned about making sure my finances keep up with that growth.
Any advice would be appreciated.