BUSINESS ADVICE
CEF PATRONS MILLS SELIG AND FPM SHARE GUIDANCE AND ADVICE TO CEF MEMBERS…
Five steps to business success in a challenging environment
L ike other sectors in Northern environment. As the various supports provided during the pandemic come to an end, many businesses find themselves carrying extra supplier debt and/or under pressure to repay HMRC arrears and government-supported loans. At the same time, companies tied into fixed-term contracts face procurement challenges for both materials and labour, while across the entire construction sector, energy and input costs are rising Ireland, the construction industry is currently facing a challenging trading amidst uncertainty about security of supply. All of these factors, and the prevailing economic environment, combine in a perfect storm of tough trading conditions. However, while this makes it more challenging than ever to budget for projects and price work, there are practical steps that companies can take to minimise risk, protect their business and find new opportunities.
1. RECOGNISE THE WARNING SIGNS Early indicators that a business is entering financial difficulty typically include problems paying suppliers and/ or HMRC, loss making contracts, cash flow difficulties, insufficient funds to pay wages, problems obtaining credit and/or having to introduce personal funds into the business. Signs like these need to be acknowledged and acted upon without delay. 2. SEEK PROFESSIONAL ADVICE EARLY The earlier a company obtains professional advice, the more options it will have to resolve its difficulties. Potential solutions include entering a time to pay arrangement with HMRC, organising a simple re-financing of the business, analysing costs and improving performance. Depending on the severity of the financial problems, a formal
insolvency rescue process such as a Company Voluntary Arrangement (CVA), Restructuring Plan, or Administration may be required. While these processes aim to rescue the business, it is critical that matters such as tendering, supplier terms and working capital requirements are taken into account. If the correct advice is not obtained, companies can find themselves entering into transactions which can be reversed in the future, or which expose directors to sanction for noncompliance with their statutory duties. 3. PROTECT YOUR POSITION When supplying or purchasing services and goods, companies need to protect themselves from the potential insolvency of their customer or supplier.For sales, this can be done by limiting exposure to certain types of customer (eg contractors), invoicing and collecting debt promptly and seeking retention of
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