How to use breathing space to build a better business
By Donna Crompton, director at Leonard Curtis
The Government has announced that it’s giving businesses much-needed breathing space with extension of insolvency measures to relieve pressure on businesses dealing with coronavirus.
It intends to extend the power granted through the Corporate Governance and Insolvency Act to make temporary amendments or to modify the effect of corporate insolvency and governance legislation.
While this provides more time for businesses to come through this testing period there is a strong call within this for companies to plan, adapt and build back better.
When people come to us we are always looking to do exactly that if we can. It’s a myth that calling in an insolvency practitioner is the death knell for the business .We just get very practical.
And there are three things we say. The first concerns forecasting. The main issues here are distinguishing between one-off problems, a delayed payment or sale that did not materialise, and real structural challenges in how the business is set up.
Many good businesses are trying to manage unprecedented issues triggered by Covid-19. For others there are problems that are long overdue a very good look.
If there is one positive from Covid it’s the effect it has had on shaking up business process. Everything is under scrutiny now. We help businesses take an honest look at forecasting.
Secondly, we encourage business owners to regularly review and challenge their forecast to work out how they can bridge any gaps in cashflow.
Thirdly – and crucially – if a business is experiencing financial distress, we do encourage business owners to take action now, and not be afraid of the insolvency process. Rescue is always the priority.
Where we are referred early enough, we can usually develop a practical strategy to put the company back on a steady footing or into the best possible position for the next steps.
There is no doubt that the virus has rocked the business world to its foundations, but we see resilience in people and those with a passion for their businesses which has driven them in new directions.
They say necessity is the mother of all invention and we have seen incredible strides being made in many sectors – the time it has taken for organisations to transform operations to fit in with a new way of life is amazing. Transformations that would normally have taken months if not years to come to fruition.
We have seen this agility first hand in our dealings with our Chester and Liverpool customers, finding ways to fight back, and we have been supporting them with practical advice, time to pay arrangements, alternative funding solutions for a new service offer or change in direction.
There is a great mood of collaboration. We are seeing businesses making smart, proactive decisions to try and stop the virus in its tracks.
So a level of business continuity is possible for anyone looking to take the risk and push for change to make their organisations fitter for a very different future.
To find out more about how we could help contact us on https://www.lcbsg.co.uk/locations/chester/.