COVID-19 news update

As we enter some very uncertain times, we list below some thoughts and ideas collected from colleagues on surviving the Covid-19 economic crisis.

WILL IT END: There is a global short-term downturn, but we will come out of it. We all need to try our best to survive and be in the best possible position for when the recovery starts.

THERE’S VERY LITTLE YOU CAN DO RIGHT NOW: In reality, there is almost nothing individual companies can do to change the current outcome. We just need to accept the fact that we will find trading hard until at least Easter, so keep yourself, your colleagues, customers and suppliers safe and your business operating.
 
WE’RE IN THIS TOGETHER: Everyone is having the same issues. However, companies face a variety of differing challenges depending on their market sector and or type of services delivered. But cash flow will present most businesses with issues over the next few months.
 
KNEE – JERK REACTIONS WON’T HELP: It’s all about cash flow conservation in a calm, orderly way. Making knee-jerk reactions with mass redundancies and being unreasonable with customers, staff and suppliers is unlikely to be beneficial. When normality returns, you will be looking to rehire many of your valued colleagues, while poorly treated customers and suppliers will remember long after coronavirus is forgotten. Most teams of employees would prefer to collectively take a temporary salary cut and work fewer hours than see people individually made redundant permanently.
 
SCALE BACK ON ALL NON-ESSENTIAL COSTS: Many variable costs can be turned off or reduced quickly and with minimum penalty and restarted easily.
 
BE REALISTIC: There is no fairy godmother or benevolent investor. Why would anyone put money in your business at this time, and if they would, on what terms? Be realistic.

THERE IS HELP OUT THERE: The government at their daily briefings have announced support including a wages furlough scheme, VAT payment deferrals, a government backed guarantee loan scheme, HMRC Time to Pay arrangements and rate reliefs.
 
A new temporary coronavirus Business Interruption Loan Scheme has been introduced, delivered by the British Business Bank. We don’t believe the banks have a clue yet about how this is going to work in practice, and how easy it will be to access. Keep your eyes open to more information on this and talk to your own bank.
 
A more immediate solution may be contacting the HMRC Time to Pay coronavirus helpline on 0800 015 9559 or visit the website. Instant cash flow benefit can be obtained by deferring part or all your PAYE, National Insurance, VAT or corporation tax payments, so these amounts don’t leave your bank account when you most need it.
 
TAKE THIS OPPORTUNITY TO IMPROVE: Take this opportunity to improve the operations and processes in your business. While operational activity is slower, use the time wisely to do the things you never have time to do because you are too busy – but really should. And upskill staff. There may be an opportunity to restructure parts of your business. You or your team don’t need to sit around idle. There will be a bounce back, and you need to be ready to grasp every opportunity.
 
EXPERIENCE COUNTS: Experience does count, as does keeping a cool head. we need to keep those around us reassured that we are doing all we can to protect both our businesses and them, in terms of their health and security. We need to continue to take considered and measured decisions, not all of which will be easy. Go back to point one, it will end, and we need to make sure we are still around to see it.
 
KEEP SMILING: We can’t do much about the world we currently find ourselves in. Keep in touch with people, sometimes just having a friendly voice on the line is all we need to keep on going. Those are the moments you cherish.
 
If you are worried about the effect Covid-19 will have on your business, please do call us and we can help you decide on the best action plan to steer you through these uncertain times.
Kind regards
 
All at McKenzies
  
And thank you to Jonathan Wall of Elmore Wall for allowing us use some of his thoughts on the current crisis.