Keeping your business safe for the year ahead
During the last month and a half (longer for some) of being in lockdown, the government has rolled out a range of different support packages with a view to helping many businesses to come through this difficult period.
The future is still unclear and the ways in which we do business, socialise and make purchases may be changed for many months ahead, if not forever.
The words ‘stay safe’ have started to appear at the end of emails or at the end of telephone calls as a unified sign off that we have all come to recognise. For the individual, the inference is to keep yourself from harm’s way, keep your mind and your body healthy, follow the medical guidance and, eventually we will come through this.
When we look at what ‘stay safe’ means to businesses the same principles apply: Keep your business from harm’s way, keep it healthy, keep abreast of the official guidance and you will come through this.
What are you doing to keep your business out of harm’s way?
In order to keep your business from harm, you will need to build layers of protection. This is a question of your sustainability and resilience: Now is a good time to speak to your business adviser and get expert advice on how you can navigate the year to come; you should speak to your current bank or finance provider too to discuss your situation, what can be done now and in the coming months; now is also the time to consider extending overdrafts or refinancing your existing assets if this is practical.
The government has pledged assistance that will help many businesses and with the introduction of the Bounce Back Loan which is 100% guaranteed by the government, many businesses that didn’t qualify for the first wave of CBILS now have another option.
As well as accessing additional finance, you should look to seize new opportunities. Now is the time to work on your business rather than in your business. If you are currently unable to open or if you are working but with a reduced operation, take some time to really look at your business, take stock and evaluate things.
What is the goal for your business for the next 12 months? What does success look like? If your goal is purely to keep your business afloat then how are you going to achieve this? What is your business’ unique selling point and how can you use that during the current situation to either continue trading or simply to stay in your customers’ sight?
How are you keeping your business healthy?
Well from a financial perspective, I refer you back to a trusty 13 week cash flow: Whether you’re able to generate income right now the bills will continue to come in and planning how you are going to pay them will provide you clarity on whether you have enough money in the bank to keep your business running. You should also consider producing a full 12-month cash flow so that you can map out when you expect to start trading again, when you will need to start trading again and determine how healthy your cash flow will be during the year ahead.
A substantial part of having a healthy business right now is having a healthy level of cash that will allow you to ride out the challenges of the year ahead. Of course, no one can truly know what will happen down the line but again planning for the worst case scenario means you can take decisive action that will alter that outcome.
If you don’t feel confident in putting this together or if yours is a mainly cash business in hospitality or retail, you should speak to an adviser sooner rather than later. They will be able to work with you to build a cash flow forecast and run through various scenarios with you.
Are you up to date with government guidance?
The government has announced a series of measures and steps over the last six weeks that it will be taken in conjunction with external bodies that will help businesses get through the next six months and beyond. These range from reducing business tax rates to providing loans and grants to thousands of organisations.
New measures were announced by the Chancellor, Rishi Sunak, as the government said that it will do ‘whatever it takes’ to keep businesses operating. This includes the availability of an initial £330bn of guarantees, which cover measures including:
- Government-backed loans for businesses which need access to cash
- Supporting lending to SMEs, extending the new Coronavirus Business Interruption Loan Scheme (CBILS) that was announced in the latest budget. This will provide loans of up to £5m with no interest due for the first six months to businesses that don’t have enough security to meet lenders requirements
- Businesses in the retail, hospitality and leisure sectors will pay no business rates this year. Plus, these businesses will be provided with an additional cash grant of up to £25,000 per business. Additionally, grants of £10,000 will be given to 700,000 small businesses in the UK.
In the meantime, we’ve helped businesses in our region to secure around £2 million through the Coronavirus Job Retention Scheme to support furloughed workers.
We’re here to help business owners to better understand what the wide range of measures mean to their businesses and we can show you the steps you can take to be as prepared as possible for the months ahead. Contact our experts today and visit our dedicated COVID-19 Knowledgebase for daily updates.