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Checklist To Help Stop North East SMEs Catching A Cold From The Beast From The East

ByEmily

Mar 12, 2018
A North East business recovery expert has outlined a four-point plan for North East small business owner/managers worried that their companies might catch a bad cold from the ‘Beast from the East’.
 
Andrew Haslam, chair of the North East arm of insolvency and restructuring trade body R3, was speaking after the recent extreme weather kept shoppers away from high streets, disrupted supply chains, caused projects to be delayed or cancelled, and forced many businesses across the region to close early or stay closed altogether.
 
But while the snow is slowly beginning to melt across the region, the economic impact of the ‘Beast from the East’ could be much longer-lasting, especially for smaller independent stores and businesses whose finances can be stretched at the best of times.
 
Recent R3 research found that 38% of the just over 80,000 active firms based in the North East already have a higher than normal risk of entering insolvency within the next 12 months at, compared to 25% at the start of 2017.
 
Andrew Haslam, who heads up the Newcastle office of specialist business advisory firm FRP Advisory LLP, says: “The immediate impact of the recent severe weather has been obvious to anyone who actually made it to any of our cities and towns, where a high proportion of shops had to either close early or kept their shutters down for several days due to a lack of staff or supplies.
 
“The first quarter of the year is already traditionally the most challenging for businesses in many different sectors, and while the present situation may be difficult enough to manage for major name firms, for smaller businesses or independent retailers, even just these few days of disruption could put very serious pressure on their finances.”
 
R3 is the trade association for the UK’s insolvency, restructuring, advisory, and turnaround professionals and represents insolvency practitioners, lawyers, turnaround and restructuring experts who work to try to save hundreds of troubled North East businesses and the many thousands of jobs they support every year.
 
Andrew Haslam says: “The single most important thing for business owners and managers to do if they think their firms are heading for trouble is to take advice from a qualified source as soon as possible.
 
“There are more options available than ever before for helping business owners resolve difficult financial situations, and the sooner they start looking at what these are, the more choices they will have available.
 
“Keeping a tight control and overview of your cashflow situation is essential as this will help demonstrate the continuing viability of the business to all parties. Make sure too that you do all you can to get payment for any outstanding invoices within the agreed time limit.
 
“You should also communicate quickly and clearly with both your bank and creditors, showing them how you’re looking to resolve your problems and getting them to buy into the strategy that you’re putting in place.
 
“The financial chill of the ‘Beast from the East’ is likely to be felt in our region long after the snow has gone, but with the right approach, it should be possible for many struggling businesses to find their way through to calmer conditions.”

By Emily