Top 10 tips for business owners
Our top ten tips for sole traders: print this off today.
1. If the business is insolvent, the law requires you to act in the best interests of the creditors. So rule number one: maximise creditors interests in all decisions and actions, not just your interests!
2. Don’t make decisions based upon advice from a man in the pub; these people don’t know the law or how to act properly. They will get it wrong and so will you.
3. When making important decisions about your business, remember that you could lose your home, marriage and become bankrupt if things go wrong. Think carefully and write down decisions and why they were made. This is called taking minutes. This can save you from forgetting why a decision was taken in future.
4. Is your business viable and do you want to save it? Or do you want to stop? What does your heart of hearts tell you?
5. Make a list of all assets and liabilities. Put this on a single sheet of paper. List the positives and negatives. This will help establish the viability of the business. Do the same for your personal assets and liabilities. Remember as a sole trader, the business debt is your debt.
6. Work out your cashflow daily for at least the next 60 days. Call us for a free daily cash flow spreadsheet if you need help. When we do rescue work we only pay wages, insurances and essential items UNTIL we know what the plan is.
7. Stop all expenditure and payments until you work out a plan. Break it down to simple steps.
8. Set out a recovery plan if you want to save the business. One sheet of paper is all that is needed. What steps need to be taken: do you need to cut costs, people, products, spending, drive marketing/sales? If the business is no longer viable, act quickly to avoid making the situation worse.
9. Make a decision based upon the above steps. If you’re unsure what the next best step is, call us for a confidential chat on 0800 9700539.
10. Get professional advice; all reputable corporate recovery professionals will give you a free first meeting.
All of these steps are carefully designed to maximise creditors interests and protect you as an individual. This is important as your personal assets and those of any spouse are at risk now.
