Whether you trade as a sole trader, or as a Limited Company with a number of staff, most of your working life is spent planning. Planning your marketing approach on social media, considering replenishing stock levels, drawing up staff rota’s, diarising work loads etc, numerous tasks that are considered and planned in advance. Most of it is carried out as part of “getting the job done” and often as a habit formed since setting up your business.
Then in the middle of March, the true seriousness of the Coronavirus crisis was felt, with all the business planning turned on its head in an instant. We are in unchartered waters, and it is very easy to let panic set in.
However, there is a lot of practical things that can be done to navigate your business through these difficult times and to still drive your business forward and through the other side of this crisis.
- CASH FLOW FORECAST
This is probably the most important thing to do right now. With the uncertain times ahead, it is essential that you plan your way through this financially. By putting together a good cash flow, forecasted for at least the next 12 months, you can ensure that you have a clear vision on the financial position of the company. It might seem daunting when things are at their worst right now but having even a simple spreadsheet showing the monthly cash position of the company, can help you be proactive rather than reactive. Review all outgoings carefully and consider stopping all direct debts and standing orders so that you can settle creditors manually, as needed.
With the help that is available from the government currently, it is important that this is used wisely. Ie VAT and income tax deferments are helpful in the short term, but the repayments later down the line can impact cash flow badly if not planned for carefully. In the same way, any grants or loans received now, has to be managed carefully so they are used to fill cash gap until income can be generated again.
- ASSESS HELP AVAILABLE
There are a number of various options available for businesses to help them through the crisis. Ensure you understand all that is available to your particular business and then assess, with the help of your accountant and/or cash flow, which help is best and, more importantly, affordable for your business. Consider the longer term future of your company and retain your staff so that when the restrictions are lifted, your business can resume immediately.
Few businesses will have no debtors or creditors going into this crisis. It is important to communicate and stay in touch with them. Review your order book and consider if any orders can be converted into cash in a quick time frame. Consider if any future orders should be covered by a deposit or payment in advance. Negotiate payment terms with your suppliers where you can. Be kind. Every business is being impacted by this crisis and it is essential to ensure that the longer term working relationships are not damaged in the sort term.
- PUT YOUR PAPERWORK IN ORDER
Now is a perfect time to catch up with all the overdue paperwork and bookkeeping, especially as it is the end of the tax year. Carry out the administration, update business policies, and tackle the filing. Get everything in order so that it is a fresh start when business gets back to normal.
- SKILL UP
This is the perfect time to take some online courses and skill up. Whether it’s an excel course, or a bookkeeping course, or your CPD etc, there are numerous courses available.
Rarely does a business owner have time away from a business and manage to relax. We understand that this pandemic is extremely stressful, but take the opportunity to take care of yourself and be kind to yourself. When the business wheels start turning again, it will be 24/7 for most people, so make the most of some free time now.
If you would like to discuss any of the above or have any other queries about how you can make the right decisions for the future of your business, please contact Helen at HRA who would be happy to help.