Are you seeing any light on the horizon? Are you ready to break out of the bunker mode and eager to get back to business as usual? Are you concerned about how you will find the cash to make it happen?

Fortunately, the economic freeze that has engulfed the credit market is beginning to thaw. Capital is starting to flow again, but only to businesses and organizations that have their ducks in a row. These conditions will, undoubtedly, be the situation in the long run. Relaxed lending policies and frequent lapses in control will be a thing in the past. The days of stricter regulations are here to stay.

Specifically, lenders will be looking for drum-tight financial statements, a solid business plan and a strategy that truly embraces cash flow needs. These credentials will be crucial, especially for small- to medium-size companies and organizations where cash flow and an optimal credit package are essential to long-term success.

Here are a few basic areas that you may want to focus on before heading out into the capital market:

• Funding Priorities – It is vital that your business strategy adequately funds your priorities. During the budget cycle, managers should continuously ascertain whether expenses are appropriate and effectively aligned with revenues. Going through the revenue / expense alignment exercise helps resurrect problems as well as opportunities, which, in turn, helps identify necessary changes to accommodate the business strategy.

• Optimize G&A Expenses – Most companies and organizations in the small -to medium-size range pay, on average, 20% more than they should on G&A expenses. Companies within this revenue range are usually very good at managing core expenses, such as raw materials and people costs. However, they don’t have the resources to find and sustain best value in their G&A spending. This can be a frustrating dilemma, considering that savings in G&A are normally fixed in nature and, accordingly, can go directly to the bottom line and cash flow – if they weren’t being utilized elsewhere. There are, however, ways to alleviate this dilemma. For starters, initiate an action plan to develop an overall cost management strategy and optimization goals for all primary G&A categories. Set expectations for everyone who will participate in G&A cost management and initiate an on-going audit process that assures best value expectations are sustained. Last and not least, it never hurts to ask your suppliers what you can do to reduce costs.

• Cash Cycle Opportunities – No ifs or buts about it - slow cash flow equates to higher loan costs. Look for cash flow opportunities in your production cycle. For manufacturers, explore opportunities to increase inventory turnover via application of just in time and lean management strategies. Continuously scrutinize and, if necessary, eliminate products with low margins. Expedite collections on Account Receivables by using ACH for collections and accepting credit cards on your web site for payment. Approach customers aggressively who historically do not pay their bills on time. Optimize your Accounts Payable process by ensuring that bills are paid when due, but not beforehand.

Bottom line, any organization that has strong financials, in conjunction with a solid cash flow strategy and reputable payment record, will always be the ‘perfect child’ for an optimal line of credit.