A sole trader's do's and don'ts
This is not a complete guide to the actions you should take but the rules here will hopefully guide you through the difficulties you are facing.
There is one golden rule to remember:
If an action or step seems wrong or too good to be true, it generally is.
Always look at what your creditors might think. Those extenuating circumstances may have seemed reasonable at the time but if the business fails and you have no clear record as to why decisions were made, they could seem less appropriate in the future.
Below are the top do’s and don’ts to follow if your business is struggling:
Do
– Talk to us if you have worries or concerns – we’re here to help!
– Build a detailed picture of your financial position
– Build a detailed picture of your sales prospects
– Note down all decisions or assumptions you made when reviewing the position
– Be honest with yourself, those that work for you and those at home
– Take advice from various professionals
– Look at all options before making a decision to act
– Consider all objectives: yours, the businesses and those people around you, then build a list.
– Formulate an action plan and then ACT
– Talk to the bank
Don’t
– Bury your head in the sand – problems will not go away
– Guess about financial details. You need to build a detailed picture of your debts and assets
– Spend lots of time building accounts that are years old
– Blame everyone else
– Ignore legal paperwork. You should fill in documents to the best of your knowledge, make copies and act responsibly
– Prioritise creditors incorrectly – call us for more details on this complex insolvency law
– Hide the issues from your employees and the people around you
– Ignore professional advice – they can sometimes “see the wood for the trees” when you cannot.
– Ignore closing the business as a serious option. There is life outside your business and working for someone else may not be as bad as you think.
– Keep changing plans
– Lie to the bank or anyone else. They have a habit of coming back to haunt you
– Be unrealistic
Please feel free to call us on 0800 9700539 if you’re unsure what to do next.
