Financial Risk Assessment
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How manufacturers can reduce risk with Financial Risk Assessments

Ensuring your manufacturing business is paid on time, and engaging with financially healthy customers and suppliers, is essential for the growth and security of your finances. However, if the last two years have taught business owners anything, it’s that the worst can occur and it’s wise to protect your cash flow accordingly. One of the ways a business can reduce its risk of exposure to poor cash flow, and even default, is by utilising the most comprehensive intelligent financial assessment tools available. This is where CreditorWatch’s Financial Risk Assessments come in.

How can Financial Risk Assessments help manufacturing businesses?

Maintaining healthy cash flow is critical to the health of all businesses, especially those within the manufacturing sector. There are additional pressures in this industry, as companies must forecast the cost of purchasing raw goods and machinery, weighed against the unpredictable volume of products or services sold, and the costs generated in production.

When invoices are paid on time by creditors, the business can continue to operate harmoniously. You need that healthy cash flow to buy components and materials, and pay suppliers. Therefore, it’s worth doing your homework on the customers and suppliers you choose to do business with – especially when it comes to large or long-term contracts. But how do you do a financial risk assessment, a highly complex undertaking, without distracting from high-level day-to-day tasks? This is where the Financial Risk Assessment service from CreditorWatch may offer a helping hand.

A Financial Risk Assessment from CreditorWatch provides businesses like yours with the data it needs to thoroughly assess the financial viability of customers, trading partners and suppliers. It is the most comprehensive customer and supplier risk-assessment tool available from our suite of helpful products. You’ll gain valuable insight into whether an entity can pay their invoices on time or honour their supply contract.

What information does a Financial Risk Assessment provide?

Financial Risk Assessments utilising company financials, ASIC records, and CreditorWatch’s exclusive trade payment data. All this information is then assessed by an experienced analyst to provide businesses with tailor-made reporting on trends, ratios, and key financial performance indicators, over a two- to three-year period. This includes:

  • Cash flow data
  • Income statements
  • Balance sheets

Financial Risk Assessments provide businesses with comprehensive information, packaged in a user-friendly way so that you can understand what this data means for the business. This may then allow for easier high-value financial decisions around which entities to engage with, or which existing customers and suppliers to speed up payment collection with.

Is the report automated or prepared by a professional?

Unlike cookie-cutter financial assessments provided by other reporting agencies, CreditorWatch’s Financial Risk Assessment offers four levels of concise, reliable analysis from a Chartered Accountant (CA) or a Certified Public Accountant.

  1. Financial Risk Assessment – Your supplier or contractor’s financial data is assessed over a two-to-three-year period. You’ll be provided with a report on trends, ratios, and explanations on key financial performance indicators.
  2. Financial Risk Assessment with Analysis – You’ll gain a tailored and detailed financial risk assessment of supplier or contractor’s financial strengths and weaknesses, as well as financial trends, expert forecasting and recommendations.
  3. Financial Risk Assessment with Contract Assessment – Similar to the above, you’ll also gain an additional assessment of your supplier or contractor’s value.
  4. Financial Investigative Report with Contract Assessment – The most detailed report designed to assess your strategic suppliers and contractors and their contract value.

How long does it take to get a financial risk assessment?

When you outsource your financial assessment to CreditorWatch, you can have your Financial Risk Assessment report ready in two days, for a competitive price. This speedy turnaround can be a lifeline for manufacturing businesses, especially as you may not have the time to perform this complex financial analysis in-house when you are prioritising other risk factors, like supply chain management in a post-pandemic environment.

Understanding the payment behaviour of a client base ensures that the business properly monitors and controls the direction, allocation, and usage of its financial resources. Without smart financial assessments tools, an environment of time-poor employees working in the dark to budget and forecast risk exposure appropriately can develop. It makes sense to mitigate the risk of non-payment and poor cash flow upfront with a data-driven assessment.

Speak to our team today about how we can help protect and grow your manufacturing business through smart financial assessments.

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Josh Bicknell
Senior Account Manager
Josh Bicknell joined CreditorWatch in January 2022 as a Senior Account Manager. He is passionate about technology and how businesses can utilise CreditorWatch’s market leading solutions to mitigate any potential risks.
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