Off-bank financing solutions for SMEs

As a business owner in Switzerland, you've probably noticed rising prices and inflation, which can have an impact on your cash flow. In this video, experts discuss alternative non-banking solutions to help SMEs maintain their working capital and avoid liquidity problems. As a result of rising interest rates, the granting of credit is set to tighten in the weeks and months ahead. As a result, SMEs will have to turn to alternative solutions or change banking institution in the hope of obtaining liquidity for growth or investment.

In this article, we'll summarize these solutions and give you some advice on how to manage your financing file effectively and obtain a long-term liquidity cushion. Read the interview here:

https://youtu.be/Mm-a7Ye4Jbs
Interview with Thierry Dime for Le Monde Economique

Leaseback to refinance your company's dormant assets

The first solution discussed is leaseback. This is a refinancing option for your company's machinery and equipment, i.e. assets such as construction cranes, merchandise inventories, real estate, etc. . This allows you to free up liquidity to maintain your working capital and give you greater flexibility. This option can be advantageous for companies with substantial assets that need liquidity quickly. Very often, it is on the assets side of the balance sheet that these assets are either depreciated, or valued at a very low level. As a result, the company has significant dormant reserves. This is why an on-site visit to the company is so important when analyzing the financing file. This enables all existing assets to be properly valued.

Factoring to secure liquidity

Another solution is factoring, which involves pledging or selling your invoices to a factoring company to obtain cash immediately and avoid working on a just-in-time basis. This option is particularly useful for companies with customers who take a long time to pay their invoices (between 30 and 120 days). By working on cash flow, you can avoid liquidity problems and maintain your working capital. There are a number of factoring solutions available: discrete, full-factoring, partial assignment, global assignment, etc.

Find a competent advisor or financial coach to avoid a liquidity bottleneck

A financial coach or finance expert is also a solution that can help business owners manage their cash flow more effectively. As one of the experts in the video pointed out, business owners are often preoccupied with the well-being of their company and staff, but can forget to take care of their finances. A financial coach can bring an outsider's view and help to better understand the financial challenges you face with an important touch of confidentiality and discretion.

It's important to note that these alternative solutions don't replace banks, but can offer additional options for SMEs in Switzerland. It's also essential to bear in mind that every business is unique, and the most appropriate solution will depend on each company's situation and needs.

Stay creative, ingenious and surround yourself with the right people to boost your company's accounts

Finally, it's important to stay creative and bring freshness to your business, even in the face of inflation and rising prices. Leaseback can be an option for financing modernization projects, while factoring can help maintain your working capital. Don't forget that your financial coach can help you find creative solutions to better manage your cash flow.

In conclusion, alternative solutions (bridging loans, bridge financing, fixed advances, mezzanine loans, junior or senior debt, equity financing, participation capital, bonded debt, etc.) outside the bank can help SMEs in Switzerland to better manage their cash flow and maintain their working capital. If you have any questions, or need help in finding the right solution for your company, please do not hesitate to contact a financial expert or coach.

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