Generating cash for growth
A MFI Furniture Group case study

Page 5: Building the cash base

Any business that wants to grow must secure the necessary funding. There are several sources of cash funding for a public limited company (plc). It can:

  • sell further shares to existing shareholders at an attractive, discounted price
  • raise funds from loans (where the borrower pays interest and eventually the principal) or from short-term borrowing in the form of a bank overdraft. This results in a heavy burden of interest
  • generate and plough back profits. This is a really attractive option. Profit is internally generated cash that is the reward for making the assets of the company work more efficiently.

MFI Furniture Group | Generating cash for growth


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