Staying Afloat When Times are Tough

Our clients often come to us because they just didn’t know which way to turn.

Their business model may be profitable on the whole, but due to a few consecutive financial issues they are finding it difficult to see how they can ‘stay afloat’ and continue to trade.

In these circumstances it may seem like a hopeless situation, with creditors knocking at your door and not enough money in the bank to pay them.

Our advice is to stop, breathe and look at your situation objectively.  Are there things you can be doing to rectify the problem and keep your business going?

1. Take stock of your position

It’s easy to get caught up in the survival of each day but the important thing to do is to take a step back.  Look at the bigger picture; does your business have a future once your creditors have been paid?

2. Assess your restructuring options

When a company is in crisis, tough decisions have to be made.  How can you make your company work?  Can your staff undertake multiple roles?  Do you need to make redundancies?

3. Liquidation of assets

We are not taking about selling everything but it is prudent to look at your company’s assets to see what you can reasonably liquidate and keep the company running, rather than clinging on until they are liquidated for you.

4. What is essential?

Look at your outgoings – what do you see as essential costs?  Again, these decisions can be tough; you may have to sever long standing relationships with suppliers, staff ‘perks’ may have to be cut until you are back on your feet, and again, redundancies may have to be considered.

5. What are your financing options?

Have you exhausted all options?  As long as you can prove you are doing all you can by looking at all of the points above, you may find that creditors or financial establishments are a little more favourable to help out.

Remember creditors would rather have something than nothing, and the liquidation of your company would not guarantee payment.  Are they willing to consider a payment plan to pay off your debt whilst spreading payments out?

Next steps

One of the most important things to remember is to act rather than bury your head in the sand.

The quicker you seek help and advice the more likely it is that you can turn things around and your business could be back on track. If something is wrong get in touch with us today on 0800 975 0380 before it gets worse!