Coronavirus: our top tips for businesses

Few businesses will be left untouched by the impacts of the Coronavirus pandemic, but despite these dark times, there is still a determined entrepreneurial spirit.

Currently, many of our clients are adapting their business strategies to ensure they are in the best position possible to come out of the crisis and there are numerous opportunities available that we are helping them take full advantage of, which may be relevant to you.

  1. Raising finance - to secure a loan, you will need to present a tailormade package of information (including a business plan, cashflow, profit and loss accounts, and balance sheet), that demonstrates your need for finance, along with a watertight plan to repay it. You also need to know the right bankers to go to. The government's Business Interruption Loans, along with the recently announced Future Fund and Innovation UK schemes are good options; however, you may have a better chance of success through known contacts. We work regularly with bankers who take the time to understand a business proposition and can help clients find sensible finance arrangements. For further information, please see our guide to accessing bank finance.
  2. Accessing government support - all businesses should review the government funded support schemes they are eligible to apply for and submit their applications as soon as possible. These include the Coronavirus Job Retention Scheme, Self-Employment Income Support Scheme, Statutory Sick Pay support, Business Interruption Loans, Business Rates Relief, Grants, and HMRC Time To Pay. For further information, please see our detailed factsheet.
  3. Cutting costs - all businesses should be reviewing their overheads to see if there are easy cost savings that can be achieved, including premises and service costs. Where possible at this difficult time, we would encourage you to continue paying local suppliers as a priority over larger one-off liabilities, to try to keep the supply chain moving.
  4. Forecasting - short-term cash flow forecasts will help highlight any financial pinch points more accurately so that you can plan around any potential issues.
  5. Outsourcing - as more staff are off work due to the Coronavirus, many businesses are considering outsourcing. Farming out non-core functions can also achieve significant cost savings and bring in additional expertise in bookkeeping, management accounting, VAT and payroll as and when needed.
  6. Deferring tax - your next VAT payment should be delayed through the automatic deferral offered by HMRC. To apply to extend VAT payments further, or if you’re unable to pay your Corporation Tax or PAYE bills due to COVID-19, you’ll need to call HMRC’s Time To Pay helpline on 0800 024 1222 (open 8am-4pm, Monday-Friday), or the usual HMRC payment numbers if that is busy. For more information, please see our detailed factsheet.
  7. Rental holidays - businesses should be discussing rental holidays, deferrals, or monthly payments with their landlords as a matter of urgency. We do not know how long this crisis is going to last and businesses need to retain as much working capital as possible to be able to pay staff and suppliers.
  8. Existing debts - some banks would appear to be being accommodating in trying to help both businesses and buy-to-let Landlords have a capital repayment holiday for up to six months if they are in difficulty. This will of course likely result in increased payment or an extension of the payment period, so it may be worth restructuring existing debts to reduce costs.
  9. Insurance - all businesses should be reviewing their insurance policies to see if they have cover, especially in light of government enforced business closures and the national COVID-19 lockdown. Please see our factsheet for more details.
  10. Cloud accounting – with more businesses working remotely, it could be a good time to consider moving from a desktop to Cloud-based system. This will give you access to real-time financial data and increase automation of basic accounting tasks to save you time and money.

Shaping and strengthening your business

A visionary, commercial approach to strategic business planning is going to be essential to succeed in the new economic world. Shaping and strengthening your cost base in sync with your turnover quickly is fundamental to this, as is being realistic on how this is likely to be achieved.

Another challenge lies in performance management and motivating staff to work more effectively and flexibly than they were before, as well as facing up to the possibility of having to reduce staff numbers.

The businesses which will prosper are those that have a clear idea of what they are trying to achieve and have the management team aligned with that vision. In the light of new economic realities, previous strategic plans may need to be adapted and the sooner this is done, the better the position you will be in when the market lifts.

For further advice, or to find out more about our business support services, including strategy planning, outsourcing, cash flow management and Cloud Accounting, please see our website, or contact Debbie Boulton on 01225 325580, or email db@richardsonswift.co.uk.