Updated: 8th January 2020
Over the past couple months our debts and liabilities have been steadily increasing and we’ve been unable to keep up with repayments. Our clients have been slow at paying us and we just don’t have enough incoming funds to work with. At this point we are so far behind it is hard to imagine a successful outcome from this position and our current cash flow problems. Perhaps if we reduce our debts we might be able to recover from this. We don’t necessarily want to dissolve the company and give up, but we need some kind of solution as soon as possible otherwise we’re afraid we’ll have no choice. What options do we have to save our failing business?
Unfortunately, we hear this very same question every day of the week because the economy has been in a slump for several years now. The most common reason why so many companies are failing is because they are not getting paid as quickly as they should. Perhaps a loan against your book debts, such as invoice factoring or discounting would increase cash flow quickly. Also, many companies have noticed a decrease in the amount of products or services being ordered which is compounding their problems. Together with slow paying customers, a lack of sales can be the downfall of any business.
What we would suggest is that you consider talking to a professional insolvency practitioner because there may be several factors at work simultaneously. Sometimes a Company Voluntary Arrangement would be the best option to set up a reasonable repayment plan with your creditors, including HMRC. Other times you may simply need funding or financing to keep your creditors paid whilst a turnaround is set into motion.
If your current product or service line is outmoded or not in demand, it may be time to consider entering a formal insolvency process. Perhaps your directors are not up to the task which would necessitate some change at the upper levels. It sounds as though you would like to continue trading but we suggest that if you are insolvent you cease trading immediately because you do not want to be accused of wrongful trading!
Talk to one of our insolvency specialists without delay so that we can put you on the road to recovery. We provide an initial consultation at no cost to you so act before your creditors seek to wind you up.
8th July 2020
The number of emergency loans approved for small businesses across the UK has now topped one million, according to the government’s official figures.Read More
8th July 2020
Chancellor of the Exchequer, Rishi Sunak, today delivered a special summer economic statement in parliament, outlining a series of measures to mitigate the long-term damage to the economy as a resultRead More