The UK is now well on the road out of lockdown which is already allowing us to do some of the many things we have missed during the past year: meeting our families, visiting non-essential shops and enjoying drinks outside.
However, is the future as buoyant as we would hope for some of the businesses currently celebrating the re-opening of the economy?
The last twelve months have seen unprecedented levels of support from the Government and HM Revenue & Customs through the introduction of the Covid-19 support measures. Some businesses, individuals and sole traders however have fallen through the gaps. Others are now considering the future as Government support is phased out.
It is also worth considering that there has been a significant retraction in the size of the UK economy and there are bound to be lingering uncertainties over the future with Covid, plus we have the constant unknown of Brexit. It is likely that there will be a significant lag before the economy bounces back to pre-March 2020 levels.
Reopening will hopefully bring around an increase in consumer spending, but the level at which this is sustained is still to be seen, yet the costs of trading will need to be met. In order for businesses such as retail and hospitality to reopen, stock has been purchased, employees have returned from furlough so wage bills now have to be met, and there are the costs of maintaining social distancing which is likely to result in reduced trade, especially in the early days. On top of this, business owners need to factor in the repayment of any Bounce Back Loans, the reintroduction of business rents & rates and other deferred payments.
Business owners need to take action now to ensure that their businesses not only survive both in the short and long term but prosper in a new economy.
Directors should undertake an honest review of their company’s current and future cash flow, as well as the overall financial position of the company. You should consider any potential challenges that could be lying ahead within your business sector.
Your Client Relationship Director will be happy to guide you through a review of your finances. We can conduct a thorough cash flow forecast for your business, considering various trading scenarios. RPG’s Business Support team can help with monthly bookkeeping services and monthly or quarterly Management Information reports with ongoing cashflow forecasting which will help you keep on top of your finances. We would take the time to ensure you fully understood the reports and exactly what they mean for your business.
If a point is reached where we need to look at other options, we can enlist the support of RPG’s Business Recovery team who are specialist in providing an independent view of the Company and the options available. The earlier that steps are taken to resolve any potential problems, the more options are available.
If it is required, RPG Business Recovery can provide a full range of business restructuring and refinancing as well as formal insolvency procedures. Our Insolvency Practitioners have a wealth of experience and provide honest sound advice when it is most needed.
Gareth Hunt
RPG Insolvency Practitioner
GHunt@RPG.co.uk
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