Written by Ged Cosgrove, group managing partner
Over recent months, numerous sectors have had the most turbulent time they will ever experience, while employers and employees have faced novel challenges. Whilst positive stories have emerged from the UK, we must remain vigilant and focus on the practical steps needed to ensure we can emerge from the pandemic stronger.
I want to remind clients that there are only a few weeks left to apply for CBILS. It’s crucial that businesses who think they might need this cash injection to secure their future apply now before it’s too late. Even if you don’t feel at risk right now, the money could prove a lifeline in months to come. It doesn’t need to be spent; instead, see it as a worst-case scenario fund to support you in a climate that is very subject to change.
As we’ve previously suggested, it would be tenacious to start developing a robust forecast, covering every penny coming in and out of your business and a variety of scenarios. The age old saying, ‘fail to plan and you plan to fail’ has never been more apt. Businesses must analyse their turnover and determine what a 10, 15 and 20 per cent drop in income looks like and how that would affect operations. Think about the problems you envisage – how will they affect your staffing quota, working environment, revenue, sick-leave levels? Insolvency practitioners aren’t necessarily busy right now, but they do expect that to change in Q4 and Q1 next year – ensure you’re not one of their customers.
Businesses are still being propped up by Government support, but most schemes end very soon. Those who have deferred VAT, self-assessment payments and more need to be factoring these repayments into their cashflow. Ask yourself, should you split these over the coming months to repay in instalments or do you have the funds already set aside? We will work closely with you to ensure you’re prepared for this and make it as streamlined as possible.
Those who think they are at risk of future cashflow problems or even insolvency must talk to us now; we can start discussions with HMRC on your behalf to secure time to pay arrangements and alleviate some burden. The Revenue is encouraging businesses who are in difficulty to come forward and work with them to forge mutual agreements. Leave it too late, and you could be forced to provide additional information to prove you can repay funds, which is added stress and resource that will put more pressure on your business.
Our team can help you plan for any situation, making you futureproofed. The Government’s financial support has been a temporary plaster for businesses, but it’s soon to be removed… and will expose those who are at risk. Engage us, and plan with us now, to ensure your business has the best chance of survival.