I’m worried about my business, I don’t know if I can keep going

keep going

We are facing a lot of uncertainty at the moment, not only interest rates going up, but talk of a double-dip recession. A lot of business owners are worried about their business, and questioning whether they should just throw in the towel.


Let’s see what we can do right now, to ease the worry and uncertainty:

First things first

The crucial thing to do, is not to make any rash decisions. It’s a known fact that we make our worst decisions when we’re stressed, or feeling desperate. We then make impulse decisions, which are poorly thought through.

Now you must stand back and take stock of where you are. We’ll go into this in more detail later, but suffice to say – you can’t make a plan if you don’t know your starting point.

I would also suggest avoiding the news. It’s OK to keep up to date, but the important stuff will find you anyway. Just don’t have the news on repeat, and don’t use the news to make decisions.

We all know that the media overdramatise things, so steer clear, otherwise this will impact how you yourself behave and react.

Laser focus

Running a business is amazing, but can be hard at the best of times, but faced with uncertainty, and rising costs, it can sometimes seem a real challenge.

The only way you’re going to get through this is with laser focus on your own needs and your own business.

Forget about what everyone else is doing, and don’t get distracted or sidetracked.

You have to have a laser focus on your business, it is the one thing that will get you through.

When you’ve stabilised your business and have a plan, then you can go on holiday, set up your side-hustle, or rebuild the patio.

Take stock

How much cash do you need to survive personally?

Before looking at your business finances, review your personal income and spending.

  • What’s the absolute minimum you need to survive?

    • List out all your expenses, including mortgage, rent, rates, utilities, food shopping, and don’t miss out spending on one offs like birthdays, car servicing etc
    • Once you know how much income you need personally, we can look at how the business can generate this for you.
    • Make sure you think about how much income you need in your pocket, after taxes, as this will be our starting point.

Have a look at where you are now with your business:

  • How much cash do you have right now?

    • This will be funds in your bank account, and any cash you have that belongs to the business.
    • You could also look at funds on credit card, but we would urge you to avoid spending there if you can, as it will increase the amount you owe.
  • How much do you owe?

    • This could be bank overdrafts, credit cards, loans, HMRC tax repayments, and suppliers that you owe
  • How much is owed to you?

    • This is mainly going to be payments due in from customers, but who else owes you cash?
    • Are you due a repayment from HMRC? If so chase it up, or file the return that will trigger the repayment.
    • What about grants? Are there any that your business could apply for?
    • Could you look at R & D claims? If your business is developing services or products, and “overcoming a scientific or technological uncertainty”, then talk to us about making a claim
  • What are your business monthly costs?

    • Include regular payments including wages, running costs, stock, tax payments
    • What about loan or finance repayments?
    • Don’t miss these out, as you could face penalties, or your loan being called in, in full
  • What is your guaranteed business revenue?

    • Do you operate a business model where you have regular income coming in?
    • If so, make sure you know how much to expect each month, and where it’s coming from
    • If you don’t, look back and look at your average monthly income, or you could take your lowest monthly income, and use this, to be cautious.
  • What is your breakeven point?

    • This is the minimum revenue your business needs to generate each month just to cover it’s costs.
    • Be aware that your breakeven point looks at business costs, it doesn’t look at how much cash you need to draw from the business to live on, so you’ll need to factor this in too.
    • Don’t worry, we can work this out for you.

This may all sound like a lot of work but:

it will be worth it, to give you focus and clarity

and we’re here to do it for you!

if you’re using beautiful accounting software, it will tell you all this stuff and more. We love Xero, which will help you to report on all your income and outgoings, and even provide a short term cashflow

Time to create a plan

It’s time to build a financial plan for the next 12 months, and once we’ve done that, we can look at the cash flowing in and out of your business, and where there are any gaps.

  • Estimate your monthly business revenue

    • What is your known monthly income for each month for the next 12 months?
    • This will be an estimate, but based on what you already know.
    • Look back at previous months’ revenue, and factor in any seasonal income (eg if you’re in hospitality you will have busier and quieter months, so we need to reflect this)
    • Keep the estimates on the cautious side, if you estimate too high, you may give yourself a false sense of security.
    • Now have a look at bookings or orders that you have coming up, or prospective clients that you’ve quoted work for.
    • Estimate when this income will drop in, over the next 12 months.
  • What do your costs look like?

    • Start with known costs, which you pulled together in the section above.
    • Add these into each month for the next 12 months.
    • Think about when they’re likely to increase, if you have that information.
    • If you employ people, make sure you add in employers’ national insurance, and employers’ pension contributions.
    • Do you need to recruit more people? Add in the salary and other costs you expect to pay them, and when they’re likely to start.
  • Working out your estimated profits

    • From the information above, we can work out your monthly profits.
    • Start with your monthly revenue, and deduct all your costs.
    • What’s left is your business profit.
    • We’ll also need to factor in taxes. Even though you pay taxes after your year end, it is good practice to work out the tax as you go along, and transfer this into a savings account with your bank.
  • What’s left over?

  • It’s essential to consider other outgoings, that come out of your profit, for instance:

    • Corporation tax, or income tax if your self-employed
    • Loan repayments
    • Asset purchases (like business vehicles, computers, machinery etc)
    • VAT payments
    • Your dividends and drawings

How much cash do you need?

To properly anticipate how much cash you need for the next 12 months, you will also need a cashflow forecast.

  • This has a similar structure to the financial plan above, but now we’re looking at how the cash flows in and out of your business.
  • For example, you may issue an invoice to a customer today, but it might not get paid until next month.
  • So the income will appear in your financial plan in this month, but the cash won’t come into the cashflow forecast until next month.
  • The cashflow forecast will also reflect other payments in and out of your business, for example:
    • Dividends or drawings
    • Tax payments
    • Loan repayments
    • Loans or grants coming in

What if there’s not enough cash?

This is where we need to fine tune the plan.

You’ve already worked out how much you need both personally and for the business to survive through the next 12 months.

Now compare this with the cashflow forecast we’ve put together.

Do you have enough?

If you need £5,000 cash in your pocket each month, but the business is only generating £2,000 cash, we have a problem.

But all is not lost.

How do we find more cash?

This will depend on your situation and your business, and this needs your focus, and quickly.

  • How can you generate extra revenue?

    • This is a huge area to dig into. Check out our blog on building a plan for your future, which goes into more detail.
    • Firstly make sure your pricing is right, and you’re charging properly for your products and services. Don’t work for free, you’re not a charity!
    • What are you doing to attract new customers? You could have the best product or service in the world, but if no one knows about it, they won’t buy it.
    • Do you have a marketing plan, and a sales plan?
  • How can you make sure you get paid quicker?

    • You might be doing all the work, and sending invoices out, but customers aren’t paying you.
    • Check out our blog on how to get paid quicker.
    • There are so many top tips, including setting up online payments, and how to send invoices quicker.
  • How can you cut your personal spending?

    • Time to be ruthless, we’re in survival mode, don’t forget.
    • Personal situation first, what costs can you cut? Are you actually going to the gym, or can you cancel that membership?
    • Can you shop around for lower costs?
    • Do you have a personal budget? This will help you to keep your costs under control.
  • Now apply the same to your business – what costs can you cut?

    • Go through your bank statements, or your accounting software and review all your costs.
    • If they’re not generating a return, you don’t need them.
    • Look at software subscriptions too, a personal favourite of mine – are you using the software, if so are you using all the licences, and all the features? If not, downgrade!
  • Is your business as efficient as possible?

    • Look at processes, and how your team are working.
    • Are you all spending time on processes that aren’t needed, or could be automated?
    • “We’ve always done it this way” is the worst way to run any business!

Update your financial plan and cashflow forecast

  • Once you’ve identified ways to increase your revenue, reduce your costs, and become more efficient, you can add these into your financial plan and cashflow.
  • And repeat until you’ve found enough cash to support your business and your personal needs.
  • Naturally we’re the experts on all of the above, so to take the pressure off you, and the worry, get in touch for our support.

What if it’s still not enough?

If you’ve done all of the above, and you still can’t plug the gap in your cashflow, now’s the time to look at alternatives:

  • Can you look for funding?

    • Is it possible to apply for a loan, or extend the terms of an existing loan?
    • Could you look at finance for assets or equipment that you own?
    • Have you tried to arrange a payment plan with the tax office?
    • Are you able to extend your bank overdraft?
  • If you’ve exhausted all avenues:

    • It’s not always the right course of action to apply for funding, if the business can’t sustain the repayments, or maybe you can’t get extra funding.
    • If you really don’t have enough cash to continue, it might be time to make the difficult decision of closing the business, but even now, you have options:

Your exit strategy

  • Could you sell your business?

    • This may be an effective way to exit from your business, but to make sure that your customers and suppliers continue to be looked after.
    • You’re likely to get a lump sum payout, based on a professional valuation of your business, and quite often you could continue for a few years as a consultant, and still take an income.
    • It’s crucial to do this properly, to get the most out of your business, that you’ve built up and worked hard at over the years.
    • Xero have a great article on exiting your business, and how to sell your business.
  • Creditors voluntary liquidation

    • You could look at a creditors voluntary liquidation – this is where your company is legally wound up, and the insolvency practitioner will manage the whole process for you.
    • We work closely with Griffin & King who are very easy to deal with.
    • Griffin & King are also able to help you to deal with any personal debt you may have.

The important thing is to do something

    • Not knee jerk reactions, but properly considered decisions, based on facts and reliable information.
    • The more you can control the controllables, the less you will worry and panic.
    • We’re here to make sense of all this, and to help you make a plan, so please do get in touch with us today!
    • We work with many business owners, guiding them to set a plan for the future, and to focus on the priority actions that will help them reach their goals.
    • Check out how our action plan process works, and get a call booked in with Sharon and Jo!

Top 10 Advisor for Enterprise Nation








clarity trusted business advisor