With the new national lockdown, the Chancellor has announced fresh measures to financially support businesses and SMEs who will be impacted. But for businesses who aren’t sure what steps to take, Zoe Bailey, Chartered Financial Planner and Director at Tilney, shares her three top tips to help them get on stronger financial footing and make the most of the support available.
Research the support on offer
With furlough ending in April, looking at what other Government schemes you qualify for, any expenditure that can be reduced and identifying other sources of income is vital. With the government now supporting approximately 600,000 UK businesses affected by Covid-19 restrictions with grants of up to £9,000 cash – there is support out there. Small businesses can also apply for a 100% Government-backed loan worth up to £50,000, with no interest charged or repayments needed in the first year. These have just been extended until March 2021.
Explore how to protect your business should key staff fall ill
Staff well-being and welfare has arguably never been more important a consideration and in the current climate it is vital to consider these alongside business contingency plans to help maintain productivity continues should someone contract the virus. Key Person protection can help; should an employee fall ill; it will pay out a lump sum to the business to help you cover loss of profits and the general costs of hiring a suitable replacement. This will go some way to protect businesses against reduced revenues, depleted productivity and potentially lost skills.
Keep an eye on the future
It’s safe to say the future looks uncertain for many right now so, while it is important to have a plan, that plan needs to be flexible. Cashflow Modelling will help clarify whether you are on track with your desired retirement age and lifestyle or if you need to make changes now. Whether you need to continue working, can keep your preferred retirement date or if you can bring forward retirement thanks to now having a clearer overall picture or innovative thinking and positive sales despite the pandemic – speaking to a professional about this kind of financial planning is a key starting point.
Zoe Bailey said: “The announcement by Government of a further national lockdown, is a stark reminder of how much the spread of the Covid-19 virus continues to affect all our lives. These are especially tough times for SMEs, entrepreneurs and smaller independents with many forced to rapidly pivot their offerings to survive further financial hardships and lack of consumer spending.
“While the Chancellor’s announcement of £4.6billion worth of bailouts for lockdown-stricken businesses and certain venues getting access to grants of up to £9,000 will certainly go some length to help, employers need to take their own steps to counter the financial impact of this new lockdown, expected to continue until mid-February.
“Creating a thorough financial plan of action now will be key in order to support retaining staff and maintaining productivity, ensuring these businesses continue to thrive throughout 2021.”