How SMEs can secure their financing under the current conditions

Small and medium-sized enter­pri­ses (SMEs) are curr­ently facing the chall­enge of mini­mi­zing their capi­tal costs and avoi­ding liqui­dity bott­len­ecks. An effec­tive stra­tegy is the diver­si­fi­ca­tion of finan­cing sources. — Instead of rely­ing solely on tradi­tio­nal bank finan­cing, SMEs can consider alter­na­tive finan­cing opti­ons such as facto­ring, leasing, sale-and-lease-back, crowd­fun­ding, peer-to-peer lending and mezza­nine finan­cing. At the same time, funding programs and subsi­dies offer favorable condi­ti­ons that are speci­fi­cally tail­o­red to SMEs.

Proac­tive cash flow manage­ment based on the opti­miza­tion of receiv­a­bles and liabi­li­ties is also crucial. Flexi­ble finan­cing instru­ments such as facto­ring and leasing can provide addi­tio­nal liqui­dity without long-term debt. The forma­tion of stra­te­gic part­ner­ships and the use of digi­tal FinTech solu­ti­ons can also open up access to new resour­ces and more effi­ci­ent finan­cing rounds. By nego­tia­ting better credit terms and effec­tive risk manage­ment with finan­cing part­ners, SMEs can opti­mize their finan­cing costs and protect them­sel­ves against a vola­tile econo­mic climate.

Firstly, the iden­ti­fi­ca­tion and assess­ment of all poten­tial risks, inclu­ding finan­cial, opera­tio­nal and market-rela­ted risks, is of crucial importance. Based on this analy­sis, SMEs need to deve­lop stra­te­gies that include a mix of risk avoid­ance, miti­ga­tion, trans­fer and accep­tance in order to effec­tively manage the diffe­rent types of risk. Finan­cial risk manage­ment plays a central role here, ensu­ring finan­cial stabi­lity through liqui­dity manage­ment, diver­si­fi­ca­tion of finan­cing sources and the manage­ment of inte­rest rate and currency risks. Conti­nuous moni­to­ring and the flexi­ble adapt­a­tion of risk manage­ment stra­te­gies are essen­tial in order to be able to react to chan­ges in the econo­mic climate or the risk land­scape. Finally, crea­ting a risk-aware corpo­rate climate through clear commu­ni­ca­tion and invol­ving all employees in the risk manage­ment proces­ses is of great importance. This holi­stic approach enables SMEs to streng­then their resi­li­ence and effec­tively protect them­sel­ves against finan­cial uncer­tain­ties while taking advan­tage of oppor­tu­ni­ties for growth and success.

In the fast-moving finan­cial market, which has under­gone an extreme trans­for­ma­tion over the last 15 years towards digi­tal, it is important for compa­nies to keep their finan­cial stra­te­gies flexi­ble in order to mini­mize risks and take advan­tage of new oppor­tu­ni­ties. Inno­va­tive finan­cing methods and tech­no­lo­gies such as crowd­fun­ding, peer-to-peer lending and digi­tal plat­forms help to raise capi­tal more effi­ci­ently and also save costs. Tech­no­lo­gies such as FinTech, block­chain and AI enable more secure and trans­pa­rent busi­ness proces­ses and improve decis­ion-making through better data analysis.

Compa­nies should also keep an eye on regu­la­tory chan­ges and enter into part­ner­ships with tech­no­logy provi­ders to stay up to date. Staff trai­ning in the new finan­cial tech­no­lo­gies is essen­tial. This enables compa­nies to future-proof their finan­ces and adapt flexi­bly to market changes.

About Joachim Haedke

Born in Munich, Joachim Haedke is a busi­ness graduate, foun­der and mana­ging part­ner of Finanzierung.com. He was a member of the Bava­rian State Parlia­ment from 1998 to 2008. He was also a member of the board of the parlia­men­tary group for small and medium-sized enter­pri­ses and deputy chair­man of the Fede­ra­tion of Self-Employed Persons. Joachim Haedke is hims­elf an entre­pre­neur with nume­rous real estate commit­ments, a consul­ting company and sits on seve­ral super­vi­sory boards of compa­nies, some of which are listed on the stock exchange.

joachim.haedke@finanzierung.com