After an unprecedented eighteen months, the Autumn budget was always going to be met with some interest, but how do we view the Chancellor’s announcements from a Business Recovery and Insolvency perspective?
On the face of it, it appears that the budget has been beneficial for many businesses in the UK, at least in the short to medium term.
A new 50% business rates discount for companies in the retail, hospitality and leisure sectors for twelve months will certainly be a welcome relief and provide a boost to cash flow, as will the freeze in fuel duty and the simplification of alcohol duties.
These reliefs are however counteracted by the increased costs that will be felt not only by businesses but consumers over the next few months, with inflation expected to rise to 4% into early 2022 which will serve to drive higher costs and may lead to a reduction in consumer spending.
When combined with an increase to the living wage from £8.91 to £9.50 per hour, an added cost for business, higher costs mean that directors will need to be proactive in the steps they take to ensure that their businesses not only survive, both in the short and long term, but prosper in the “new economy”.
Directors should take stock of the current financial position of their company, undertaking an honest review of cash flow and future projections. The past twelve months will undoubtedly have taken a heavy toll on the finances of many companies and it is essential for directors to be pro-active and have their own road map for the next twelve months, understanding their market place and potential challenges that may lie ahead.
I would urge those business directors who, having undertaken this review, can see that they may have problems ahead, to take immediate advice. Taking immediate action can save a business’s future.
As Insolvency Practitioners, our focus is not just on formal insolvency proceedings. If we are appointed at an early stage, we can provide an independent view of the company and the options that are available. The earlier that steps are taken to resolve any potential problems, the more options are available.
RPG Business Recovery, which is based in Manchester, provide a full range of formal insolvency procedures, business restructuring and refinancing. Our Insolvency Practitioners have a wealth of experience and provide honest sound advice when it is most needed. Our advice is always provided by a qualified Insolvency Practitioner. We would be very happy to have an initial discussion with you regarding your own business or your clients’ businesses. Call us on 0161 608 0000 or email info@RPG.co.uk