Are your directors up to speed with their duties?

directors' duties Nov 11, 2021

As the Insolvency Service is quite rightly vigorously pursuing those who have made fraudulent claims for help during the Covid crisis, they are likely to be scrutinising all businesses more closely.

The number of company directors convicted of criminal activity during the pandemic has risen 205% to 122 in the year to 30 September, up from just 40 for the same period to 30 September of last year. The National Audit Office has also estimated that up to 60% of Covid BBL claims could be fraudulent or defaulted on.

There are plenty of other pressures on businesses and in particular their directors in trying to return to more normal activity in the face of a disrupted supply chain, rising energy prices and recruiting difficulties.

But it is not all doom and gloom. Times like these can also be seen as an opportunity to take a close look at what your business is offering and whether it can be tweaked to better meet the current conditions, not least the climate crisis.

It also seems a good...

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You CAN save your business and the planet!

strategy Nov 04, 2021

It is all too easy to get buried under the weight of bad news and the pressures besetting businesses when your business is not going well.

Most recently Begbies Traynor predicted that insolvencies were rising, reporting that there had been a 51% increase in Country Court Judgements in the third quarter of the year compared with the previous quarter.

But this is only the negative part of the story.

Now is also a time of opportunity!

There is another way to look at things, especially in the light of the discussions taking place at the Cop26 on climate change in Glasgow.

If your business is in difficulty and you are at a loss as to how to recover perhaps it is time to ask questions.

Is your product or service going to contribute to the need to reduce carbon emissions and help stop climate change or is it an example of a technology that is outdated?

Perhaps instead of trying to restore your business to the status quo ante it is worth thinking about how you could develop it to become...

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It's good to talk

cash flow insolvency Oct 07, 2021

In tough and painful situations it can be tempting for business owners to struggle on, or live on hope, rather than acknowledging that it’s time to call in help.

It can lead to sleepless nights and a reduction in your ability to get a grip on the situation or make sensible decisions.

It will not solve the problems of mounting debt, the threat of County Court Judgements (CCJs) and insolvency.

I am here to take your calls if you’d like to talk to a real human being with experience of rescuing and turning around businesses.

Get a grip!

The first step to resolving business problems is to know exactly what the situation is.

K2 has a number of free tools for download that can help businesses to get a grip on their situation.

They include a Cash Management tool: https://lnkd.in/gr4bkxW

And if things have gone further there is K2's Guide to dealing with CCJs: https://lnkd.in/ghPgehx

So banish those sleepless nights and worries and get in touch.

Remember the old...

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Are you a good employer?

It may not be high on your list of priorities with Furlough ending and the struggle to survive and return to peak activity foremost in your mind.

Even if you have had to make some people redundant your reputation as an employer matters.

As your business hopefully returns to more normal levels of activity there may come a time when you will need to recruit more people, and that is going to be a challenge when there is a shortage of workers in many sectors.

While redundancy may feel like a brutal process to those on the receiving end, how it has been handled can make all the difference to your business reputation. 

Did you keep staff fully informed? Did you follow all the correct procedures? Did those affected feel that you cared about them and their concerns?

K2 explained how to do it properly in this article:

https://www.linkedin.com/pulse/planning-redundancies-after-furlough-discontinued-tony-groom/?trackingId=YDCO8nDCs6wYlCRNM2wlKw%3D%3D

But we were reminded that there...

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Businesses will need agility and flexibility for the foreseeable future

cash flow planning Sep 23, 2021

Arguably we are in the greatest period of uncertainty in living memory.

A combination of geopolitics, the climate crisis, accelerating technologies, supply chain disruption, and the ongoing covid pandemic are creating the perfect storm for anyone running a business.

It’s unlikely to change anytime soon so it may be advisable for businesses to build agility and flexibility into their operations as a permanent feature.

From developing new products or services to using more automation, it may seem like a scary prospect, but that is not to say the situation isn’t manageable.

Who knows? In time it may become an exciting and enjoyable way of operating as you discover new and hopefully more productive and efficient ways of working.

To help you, K2 has a free briefing on the use of heuristics to improve your agile decision-making https://lnkd.in/g6XdRBTD

You will also need to know the business cash flow situation at any time to be able to operate in such a climate and...

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Winding-up petitions in detail

Although the restrictions on debt collection have been mostly lifted from October 1 2021, some limits remain on the use of Winding-up petitions by commercial landlords in respect of rent arrears until March 2022.

  1. Petitions can only be sought on debts exceeding £10,000 compared with the pre-pandemic threshold of £750.
  2. Creditors must give debtors 21 days to propose resolutions.
  3. WUPs cannot be used for pursuing commercial rent arrears but….

…the sting in the tail is that debtors will still be able to seek county court judgements to try to recover commercial rent arrears.

As always, I advise businesses in difficulties to manage their cash flow and to seek help if you are in difficulties.

You can download K2's free cash management tool here https://www.linkedin.com/smart-links/AQG7fCQTtXx4Zw/37139976-4f42-454f-aff5-75ae4be992c7

Or message me if you need someone to talk to.

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Lessons and new opportunities from pandemic disruption

Business activity is starting to pick up after 18 months of disruption but what lessons have those that survived learned, what new opportunities has it brought and what new practices will businesses keep as a result?

Changes in customer and client needs?

A recently-reported development has been the numbers of staycation bookings for 2022 that are already being made after people decided to holiday in the UK in 2021 due to all the complex rules overseas travel and quarantine on return.

This presents an opportunity for the tourism industry to develop their attractions and offers, notwithstanding some of the difficulties there are in recruiting enough workers.

There may well be opportunities in other businesses in the wider economy to respond with new products and services based on what clients have asked for during the various stages of the pandemic.

Changes in ways of working

While some businesses needed to furlough staff because of a drop in demand during the pandemic others changed...

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Where are you heading?

cash flow Aug 27, 2021

If your business has survived the last 18 months of uncertainty you may be hoping that activity will soon return to “normal” levels.

But there is still a good deal of uncertainty about the future given the number of issues facing businesses.

The supply chain has been disrupted, both because of the pandemic and in the UK a shortage of HGV drivers following the decision to leave the EU. Surveys from the CBI lobby group show the worst manufacturing supply chain disruption since at least 1977.

Recruitment of suitably qualified staff and shortages of materials are also an issue even if a business can afford them.

Then, the Furlough help ends completely at the end of September and the Covid loans are having to be repaid.

All in all, making decisions about the future of your business is far from easy.

Some time ago I suggested the use of heuristics as a method of help in decision making in times of uncertainty and you can see my article here:

...

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The tip of the iceberg?

covid-19 funding threats Aug 19, 2021

The High Court has closed down two businesses this month after it was found that they submitted false documents to at least 41 local authorities and the government’s bounce back loan (BBL) scheme to secure £230,000 worth of emergency support.

LV Distributions and SIO Traders were investigated by the Insolvency Service, which proved that neither company had ever actually traded.

One of the two had been claiming to supply personal protective equipment while the other had claimed to sell medical care products.

The Government has warned that it will be cracking down on Covid fraud and in June the Public Accounts Committee of MPs, for the department for business, energy and industrial strategy (BEIS), that suspected Covid-related fraud amounted to £27bn.

It has been argued that some of this loss could be attributed to a failure to carry out basic checks and controls in the rush to get funding out to struggling businesses.

The message is clear.

Businesses need to make...

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Is it crunch time for your business at the end of September?

The Government’s furlough scheme to help employers through the pandemic is being scaled back, with wage support being reduced from 70% to 60% and employers’ contribution increased to 20% this month.

The whole scheme will end on September 30.

One survey carried out this week has found that an estimated 350,000-plus SMEs cannot now repay Covid loans due to the impact of cash flow and supply chains.

An estimated 18% of the survey participants reported that they intended to make redundancies while around 16% said they could not afford to pay existing staff because of the pressure of repaying Covid-related loans.

At the same time, it has been widely reported that businesses have been facing difficulties in recruiting staff in some sectors.

So what should businesses do?

Try to hang on to staff in the hope that business will pick up?

Make some redundancies now to improve their cash flow and hope to rehire staff in better times?

How you treat your staff will affect your...

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