Reopening Your Business – Focus On Your Finances

The COVID-19 outbreak has had a big impact across the world, but as the UK government starts to give businesses the green light to open, many of them are struggling financially with approximately 35% of SMEs worried about day- to- day cash flow.

We asked our partners and business financial experts, Optimum Commercial, for their tips on what businesses should be thinking about when looking to re-open.

So how do businesses get back on their feet and rebuild post COVID-19?

“The first step you should look at when considering reopening is how much your business has been affected during this period. Has it been negatively impacted? And if so, is this something that can be rebuilt organically, or will you require some financial assistance?” says John Sellers, Commercial Finance Broker at Optimum Commercial.

If your business needs financial assistance there are a number of things you should consider to make sure you’re getting the right support.

Has your sector been impacted by COVID-19?

Different sectors will have been impacted by coronavirus in different ways so you have to consider whether you think this will be a long-term or short-term impact to your business.

“Many industries may see more of a demand for their products/service, yet others might see the reverse. For example, some industries, such as hairdressers could suddenly see a spike in bookings as there will always be a need for salons, yet businesses specialising in office furniture may see a reduction in sales due to the increase in homeworking. If the latter is the case, then these businesses may need to rethink their commercial plan when going back into the ‘new normal’.”

What activity have you undertaken to prevent business interruption?

If your business has spent additional resources to prevent interruption during COVID-19, this will need to be taken into consideration when applying for financial support. If you haven’t already, a good place to start is to look at the government support schemes available” suggests John. Read our article on the government support available for businesses.

Consider the impact of COVID-19 your customers and suppliers

If you have closed your business doors during the lockdown period, or even if you have kept them open on a smaller scale, this may have had a big impact on your customer footfall.

“Many businesses have seen a decrease in their customer numbers as they have moved to online or takeaway sales only, and many have had to close their doors completely. If this is the case for your business, has this impacted your suppliers and further down the supply chain?”.

Once business resumes, this may return to normal, but you must think about how this will affect your business going forward. Will there be any potential bad debts you need to consider among your customer base and will you need to allow longer to collect cash from customers?
Similarly, you should speak to your suppliers to see if they will allow longer credit terms to ease the financial pressure.

You’ve looked at your businesses financial situation, what is the next step?

Once you have considered where your business sits financially, you can look at which funding options are best for your situation.

“A couple of the best sources to consider at present are the government support schemes – the Bounce Back Loan or the Coronavirus Business Interruption Loan (CBILS). These can offer a low rate of interest with no fees or personal guarantees (CBILS will require personal guarantees for any facilities above £250,000) and are either fully or mainly guaranteed by the UK government. These can be arranged quickly, so could be a good option for businesses looking to get their business back up and running soon.”

I’ve already applied and been rejected, can I apply again?

Even if you have already applied and been declined by your existing bank, you might want to consider a financial specialist to source other lenders for you and help you with your proposal.

John Sellers added, “At Optimum Commercial, we understand how much businesses have on their plates at the minute, so we can take all the hard word out for you. We liaise directly with the lender all the way through to approval, so you’ll have a greater chance of success than attempting this on your own.”

Is there any other way of getting financial support without applying for the government schemes?

Yes, there are many other options potentially open to you. “One benefit from working with a financial specialist , is they can look at the full picture to see if there are other ways of raising finance for your business. This includes other assets that you may not have thought about.”

How can I find a financial specialist to help me?

You’re in luck, our partners Optimum Commercial offer advice to help your business get through this difficult time.

Optimum Commercial offer a wide range of financial services with many business finance options and providers. Their friendly, experiences team operate to the highest standards offering end to end service. You’ll be in good hands as they ensure all their clients get the right support for your business.

How have you helped businesses with financial support during COVID?

“Many businesses have struggled as a result of COVID, but we’ve done our best to help them through this uncertain time. One of our clients is an accountancy firm, who we have helped obtain £250,000 of finance to support their business” said John.

Client feedback: “Thanks once again for all your help and assistance in securing our funding earlier this week. This will prove beneficial not only in supporting our business but also enable us to help our clients at this challenging time.”

For more information or to contact Optimum Commercial for a no obligation consultation, visit our website or fill out their interest form.