How can Scottish firms manage the impact of the current CO2 shortage on their businesses?
An international shortage of CO2 is putting businesses across the country under pressure.
In the midst of World Cup fever, and with the nation basking in a spate of warm weather, the impact of the shortage on the country’s small and medium-sized enterprises – particularly those in the hospitality, food and drink industries – could be significant.
As well as a decrease in sales caused by a shortage of stock, this could also mean a lengthening of payment times from customers who have also been affected.
This is likely to affect a firm’s cashflow and increase its working capital requirements – the amount of cash needed to cover day-to-day costs – and could put strain on its ability to carry out business as usual.
It is important that businesses know there are options available to help them manage cashflow, and mitigate the impact the CO2 shortage could have.
These include working capital management tools that allow firms to analyse their cash cycles to unlock the money tied up in other areas of the business, as well as invoice finance facilities that allow companies to access up to 90 per cent of the value of an invoice within 24 hours of being issued.
These measures can significantly aid a company’s ability to navigate a lean period, and can leave them better equipped to manage a recovery period once the crisis has passed.
Most importantly, firms should be proactive and seek advice. As we navigate the CO2 crisis, businesses should ensure they act now so they have the gas in the tank needed to cope in the weeks ahead.
Fraser Sime is regional director for Scotland at Bank of Scotland commercial banking.