Remember – MONEY IN must be greater than MONEY OUT

With COVID-19 Business lockdown now into week 3 of the four predicted, there are some questions business owners should be asking themselves:

• Have you taken a stocktake of your business’s financial position?
• What are your survival options from here if this downturn continues?
• How are you going to continue meeting your out goings if your income has ceased and or is greatly reduced? What expenses can you eliminate and/or reduce?
• Have you calculated the true cost of paying 80% wages for 4, 6, 8, 10 and or 12 weeks of the wage subsidy?
• Have you checked your aged receivables carefully to ascertain who is really going to pay you when?
• Have you considered your options if things get worse and the lock down continues in some form or other?
• What work and or sales levels will be there for your business immediately the lock down is eased?
• How long will it take for you to get back to a good level of trade?
• Have you negotiated payment arrangements and/or relief with any or all of your creditors?

In answering these questions do your decisions comply with the criteria for relief from insolvency provisions of the Companies Act 1993?

If you feel that this downturn may go on, consider your long term survival options.