The financial issues that UK businesses are facing as a result of the Covid-19 pandemic have been well documented, with many significantly impacted and even forced to close over the past few months.
Whilst government support packages continue to be offered to businesses in order to assist in navigating these times, it is clear that business owners are facing significant issues and difficult decisions.
Our team are highly experienced in a range of financial options, from CVLs to CVAs and everything in between. With this in mind, we have prepared a guidance tool for directors to assist with navigating the current situation.
1. Identify and Face the Problem Head On
In difficult times, owner managers often fall into the trap of “hoping for the best”, as the alternative is too awful to consider. Unfortunately, it is this reaction that is most likely to result in the failure of the business.
It is key to be at all times aware and appraised of the issues your business is facing, and what is happening with your customers, suppliers and competitors. At a time when strong management decisions need to be made, important control measures and regular management meetings can prove vital in staying ahead of the problems.
Even if a formal insolvency process is ultimately required, maintaining this awareness and control can be key to ensuring it doesn’t necessarily mean the end of the road.
2. Act Without Delay
At times when cashflow management is key, it is imperative that regular financial information is reviewed and prepared by management.
This monitoring tool is key to identifying problems quickly, and the sooner you act, more often than not, the more options are available for your business. Delays in identifying the problems can mean they escalate quickly to an unmanageable level, resulting in very limited options.
It is key to be “ahead of the game”. Make use of the support offered, if there is a clear and achievable plan in place. If even with the support, there are doubts remaining as to how your business will “ride the storm”, there is quite often a reason for this. Trust your gut and seek advice.
3. Seek Guidance
Don’t be afraid to ask for help, be that from your accountant or a specialist insolvency and restructuring professional.
Being so intrinsically involved with your business can often lead to decisions based on emotion, something which is very understandable. However, sometimes a fresh pair of eyes and an independent view can be just what a business owner needs to assist with their decision making, and guiding a path to their future.
A key part of our advice is to understand what is an ideal scenario for you and your business. It may well be that you no longer have the appetite to continue or rebuild your business, and in those circumstances, we will assist with your exit.
Should a restructure or resurrection of your business be your key aim then we will tailor our advice accordingly and ensure that all options are explored.
Times are clearly very difficult for many UK businesses, but many of them can be saved if issues are identified and advice is sought early enough.
4. Rescue is Always the Priority
The word “insolvency” is often confused with closure or failure of a business. To the contrary, there are several types of formal insolvency processes depending on the individual set of circumstances your business is facing.
Fear of repercussions of entering into a process can often lead to a fear in taking the first step of obtaining professional advice.
There is often the misconception that seeking the advice of an Insolvency Practitioner will automatically result in the closure of your business. That is simply not the case.
Our priority is always to try and save the business and as many jobs as possible wherever we can. When we are introduced to a business early enough, we can often develop a strategy that results in all or a large part of the business being saved.
For anyone who is concerned about the future of their business, we would encourage you to get in touch with us now by calling 0300 303 8284 or emailing firstname.lastname@example.org, with our expert team happy to advise on the best options for you and your company.