Guide for Business Struggling Financially in the UK
As your business arrears build up over time, it may seem like you are running out of options to clear the debt.
80%
Over 80% Of Debt Wiped
Out On Average
100+
Companies Helped
£££
£Millions In Debt
Written Off
Guide to Saving Struggling Businesses
The pressure from creditors or HMRC may have even pushed you as a business owner to consider insolvency. In the worst-case scenario, you might have sleepless nights worrying about liquidation. However, you still have time, and still have options. The financial support options available for businesses that are in trouble are broad, but they are never fully explored by directors. What options do you have for your business? Can you still save your enterprise even after trying a few of these options?
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Options Guide For Struggling Business Owners - The Punk way
Before the Punks outline the guide to the options for a struggling business or entrepreneur, it is important to define what we mean. When there is a discussion of options, this often refers to financial or logistical help from an outside agent. Financial options may take the form of a business support loan, whilst logistical options may refer to help with cash flow or balance-sheet analysis. Because the Boardroom Punks apply a broad range of innovative solutions for struggling business, our options also include the practice of negotiation, discussions with creditors, and help with any legal stipulations. What are the options available to a business that needs to clear its debt?
It is important to understand how much trouble a company may be in. If the debt is relatively new, then the solutions needed to fix the problem may not be as invasive. However, if a company has accrued excessive debt for a long time, then we will need to apply more rigorous measures. Read our guide on how to test for insolvency to get a definitive idea of how to do this. Once this has been calculated, a company can begin to take the necessary steps to clear the debt.
With new debt or arrears that are not excessive, it may be possible to negotiate with creditors. One option is negotiating what is known as a Company Voluntary arrangement (CVA). This will give a company extensive time to pay the debt, and they usually last between three to five years. At least 75% of creditors must agree to a CVA for it to be finalised.
If a business is in trouble because of unpaid tax, then negotiations must be conducted with HMRC. During these negotiations, a time-to-pay arrangement (TTP) will be sought by the business. If a company can successfully obtain a TTP, it will have an additional 12 months to pay off a debt, and the debt payments will be organised so that they can be sustained over the agreement.
With all negotiations, a company in trouble must show intent to pay or stick to the agreements. This will allow either the creditors or HMRC to see that the business is serious about sticking to its commitments. Up until this point, a business in trouble may have struggled to keep its commitments, so it is essential to display intent clearly. This also helps if something unexpected happens during the time of the repayment schedule. For instance, a company could face unexpected circumstances, such as losing staff or a supplier. This will impact the agreement, yet if payment has been made up until this point, and there is transparency to continue with the payment, then it is likely that they may re-negotiate terms.
A business that is in trouble may need external help. In this case, administration is a valuable option. In the process of administration, an external advisor will be brought in. They will analyse the state of the debt and possible ways to pay off this debt. They may also look at the business model and the existing shareholders. If they decide that the assets can be sold to rescue a company, they will begin to organise a sale of them to existing shareholders or those who register new interest in the company. This is known as a pre-pack administration.
For any company, administration can seem like a daunting process. Nobody wants to lose control over the assets or direction of a company they have spent so much time building up. Most bog-standard insolvency practitioners will consider the solutions alongside insolvency and creditors. However, we are different in that we always prioritise the business. If the Boardroom Punks can find a way to get a company out of trouble, then we will certainly exercise this option.
WHO ARE THE BOARDROOM PUNKS?
Our business model was founded upon our managing director David Morgan’s experiences. In 2008 he received the news that his chain of opticians was trading insolvent and facing liquidation. After battling with the liquidators and the loss of assets of over £250,000, David dedicated his time to finding alternative solutions that would help with restructuring both his own business and the SMEs of the future. Today, Boardroom Punks is the solution that our director strived for, and we believe that we have the right tools in place to get any business back to a state where it can stand on its own two feet.
However, don’t just take the claims of expertise from ourselves. Our business experts have tested their skills in many different trading models. Beauty salons, haulage companies, decorators, and even jewellers have all needed the advice of Boardroom Punks. Whatever type of company you are looking to salvage, know that our solutions have been tried and tested across many different businesses. Some of the cases we are currently working on include businesses in the fitness industry, window installation, and wine. We always encourage our future clients to reach out and speak to those who have worked with us, as they are the best proof of our success.
Administration, Outstanding Debt & CVAs (Company Voluntary Arrangement)
If the outstanding debt cannot be negotiated between the creditors and debtors, it is at this point that administration may be considered, including pre pack administration. Should the company go into administration, the appointed administrator will still look to explore the avenue of a company voluntary arrangement, but there are other options they will also consider. Some of these include the selling of a business or the assets of the business, the closure of a company, bank loans and even the attempt to find new investors in the company.
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If your business is in trouble, then you can be assured that we will do everything we can to keep it on its feet. With the application of the options above, and a thorough analysis of your business model & Cash flow, we know we will have a good chance of clearing any debt. The Boardroom Punks are experts at applying their knowledge in the right areas.
Even with the help offered in this guide, your problem may be too specific to rely upon this advice alone. The Boardroom Punks understand the intricacies of business as we are a team of business-savvy professionals who take their trade seriously. If you do require further help, then feel free to book a call today. All inquiries are confidential, and you can be assured that we will approach your problem with respect and dignity. Our alternative solutions are always geared toward saving a business rather than insolvency or liquidation. The Punks have your back!
Take the first step towards saving YOUR business. Call us now or fill in our form, and we’ll take it from there.
Take the first step towards saving YOUR business. Call us now or fill in our form, and we'll take it from there.
“I was in a very bad place, David and his team saved my life, they were the ideal choice.”
Alan T
“The team at Boardroom Punks genuinely care and listen to client’s needs; most firms simply want the solution for a client where they make the most money.”
Mike W
“We had VAT issues that were affecting our ability to control cash flow. Since working with the Boardroom Punks team we’ve been able to move our business forward with a solution that perfectly suited our needs.”