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The coronavirus pandemic tested business owners and demanded adaptability in the face of rapidly evolving Covid-19 trading restrictions. As the financial health of UK businesses took a severe blow, a series of government-backed loan schemes were introduced as an effort to prevent a surge of insolvencies.

Although this secured the short-term future of Covid-19 hit businesses, their long-term viability now depends on their ability to keep up with the associated repayments, sometimes in addition to loans that pre-date the Covid-19 pandemic. As we adapt to a new ‘normal’, businesses are operating more flexibly than ever having weathered the Covid-19 storm, but how can they strategically manage company debts to stay afloat?

How are UK businesses faring from the effects of Covid-19?

Insolvency statistics compiled by Real Business Rescue to assess the financial health of UK businesses found 562,500 SMEs in significant financial distress for Q3 2021 – a decrease of 12.6% from the previous quarter. In the West Midlands, over 66,500 SMEs were in distress which put 330,000 jobs at risk. The research also found that overall insolvencies increased by 21% from Q2 2021 as financial support from the government tapered to an end in Q3 2021.

For a business to remain viable, directors must take steps to address company debts and fend off pressure from creditors, which may take the form of persistent late payment notices or a winding up petition.

A winding up petition is a formal request made to the court by creditors to close a business that they suspect is insolvent. It can be very difficult to regain control of the situation once a winding up order has been granted by the court and your business could be forced into liquidation.  For this reason, immediate action should be taken if your business is at a ‘tipping point’ with creditors to minimise the risk of this happening.

What options are available for financially distressed businesses?

If your business is facing financial difficulties, it is imperative that you seek professional advice at the earliest opportunity, to determine the most suitable route for your business. The earlier advice is sought, the more likely the chance of a business recovering from its financial difficulties.  It is the role of a licensed insolvency practitioner to discuss your options with you and provide advice as to the best way forward.

Debt recovery – If you have a backlog of payments from customers that are long overdue, it may be appropriate to use commercial debt recovery services to recover funds. This can reduce the risk of bad debt, replenish company cash flow, and work as a deterrent against debtors that are lax about payment timeliness.

Finance options – It may be the case that a cash injection is required to strengthen the position of the business and assist with long-term financial recovery.  Under the circumstances, it will be necessary for a debt-laden business to reassure lenders that it’s feasible for them to meet the ongoing repayment obligations. It may be an option to borrow against existing equity, allowing the business to access more competitive lending rates, also known as refinancing.

Repayment plans

CVA – A Company Voluntary Arrangement (CVA) is a formal insolvency procedure that provides the opportunity to negotiate with creditors and agree a schedule of repayments, which effectively breaks down the company debts into affordable monthly instalments. A CVA typically lasts 3-5 years, subject to agreement from creditors.

Time-to-Pay – If your main creditor is HMRC, you can negotiate a Time to Pay arrangement to structure the business’ tax liabilities into affordable monthly payments.

Company administration- Administration is an insolvency process which involves the management of an insolvent company being transferred to a licensed insolvency practitioner, acting as administrator. Administration gives you valuable time and legal protection to help steady the business, keeping it safe from creditor pressure and threats of winding-up action.

Company liquidation – If company debts have ballooned following Covid-19, company liquidation may be inevitable to protect the financial interests of creditors. As a company director, you must seek professional advice if you suspect that your business may be insolvent, i.e., if you cannot fulfil payments as and when they fall due and if your company liabilities outweigh assets.

If you are aware that your company is out of cash, you must cease trading. If you fail to do so, this could result in an Insolvency Service investigation.

For more information or to discuss any queries you may have, please do not hesitate to get in touch.

Michaela Daly is a director at Begbies Traynor Group’s Staffordshire office, UK’s leading corporate recovery and professional services firm. Michaela is an industry renowned insolvency expert in the West Midlands area and supports financially distressed company directors with company restructuring and liquidation options.

For a free, confidential consultation, please email Michaela Daly on michaela.daly@btguk.com.

Staffordshire Chambers is delighted to partner with Keele University to deliver local entrepreneurial support.

Designed to help budding entrepreneurs to turn their business ideas into reality, the programme offers 12 hours of support and guidance delivered through four interactive workshops.

Drawing on the experience of successful entrepreneurs, the workshops will cover key topics, from understanding your value proposition and target audience, to calculating your costs. At the end of the sessions, participants will leave with their own Business Summary and Toolkit to support the next steps in launching their business.

Available exclusively to anyone based in Stoke-on-Trent or Staffordshire who has not previously set up their own business, a new cohort will start each month until June 2023. There are three options available, each suited to a different stage of the entrepreneurial journey:

• Run by Business Advisors from the Staffordshire Chambers of Commerce, the Engaging Entrepreneurs workshops are best suited to those with some prior knowledge and experience of studying or working in business and provide an exciting opportunity to discuss and develop your business idea(s).
• In proud collaboration with Keele Univesity, the Empowering Women Entrepreneurs workshops are designed to support and inspire the next generation of women in business, providing an exciting opportunity to build relationships with other aspiring female entrepreneurs.
• Ideally suited to people interested in business and looking to develop a business idea, the Exploring Entrepreneurship workshops give you the space to ask questions, share your ideas and develop an understanding of what is required to run your own business.

Tom Nadin, Head of Projects and Business Services at Staffordshire Chambers of Commerce, said: “We are delighted to have partnered with Keele University on the Exploring Digital Entrepreneurship workshops.

“Launching your own business can be a fantastic and exciting career opportunity – and these workshops will support the development of the key skills required to be successful.

“The programme offers a holistic support package that will guide entrepreneurs through the process of launching their own businesses to give them the best start in the world of self-employment.”

Lizzie Harling, Project Co-ordinator at Keele University, said “Exploring Digital Entrepreneurship is a new and exciting opportunity for anyone wondering about what it might take to start their own business. The interactive workshops will help develop your business idea, understand what is involved in running a business and engage with successful entrepreneurs.

To find out more and view the session dates visit our website or get in touch with the Keele Gateway (01782 733001 / gateway@keele.ac.uk).

Staffordshire businesses who are considering exporting for the first time are being encouraged to explore the opportunities and support available to them during International Trade Week.

International Trade Week, which runs from today, 31 October to Friday, 4 November, aims to encourage UK businesses to export and sell to the world, and showcase the long-term support that is available to help them do so.

At Staffordshire Chambers, our International Trade Centre offers a complete solution to your international trade operations – with award-winning guidance, documentation and declaration support from our experts who have helped thousands of Staffordshire businesses to go global.

Find out more about how we can help your businesses to boost its bottom line and go global by emailing tom.hammersley@staffordshirechambers.co.uk

The Department for International Trade is running a series of events throughout the week, with highlights including: Export Academy LIVE!, Green Trade and Investment Expo and the DIT Education Day. Find out more, here.

It’s been a busy week for local businesses who flocked to Uttoxeter Racecourse for the return of our Staffordshire Business Festival.

The two-day festival boasted a hat-trick of brilliant events, including: the Speaker Summit, Broaden Your Markets and the return of the hugely popular Let’s Do Business expo.

Sara Williams, CEO of Staffordshire Chambers, said: “We welcomed a record number of guests to the festival across both days and have had some fantastic feedback from businesses.

“The three headline events offered something for all businesses – kickstarting on day one with our Speaker Summit. All four speakers offered a fantastic insight into their respective areas and it was great to hear more about their stories. I would like to thank them all for joining us on the day.

“Our Broaden Your Markets events offered a timely insight into the UK economy while helping businesses to consider ways in which they can expand their international operations. I would urge any business interested in expanding their import or export operations to get in touch with Allison Tomlinson, our International Trade Centre Manager by emailing allison.tomlinson@staffordshirechambers.co.uk

“Let’s Do Business, as it always is, was a real hit with businesses of all sizes. All stands were fully booked and it was great to see Uttoxeter Racecourse packed full of a range of companies who were all looking to do business!”

A full gallery of images from the Festival will be released in the Chamber newsletter next week.

The Chamber has a line-up of exciting events planned for the remainder of 2022, including our hugely-popular Chamber Quiz and the recently-announced Brunch Networking and Business Spotlight session in Partnership with Aston Marina .

Find out more by viewing our events calendar, here.

Stafford Chamber of Commerce has moved into its new base in Stafford after becoming an anchor-tenant of the newly-refurbished Shire Hall.

Shire Hall, situated just off Market Square in the centre of Stafford, is a Grade II listed building which, following its full refurb, will now play host to around 20 local businesses.

Hosting a diverse range of companies ranging from start-ups to international traders – it’s hoped that the building will become a thriving hub for Stafford businesses.

Stafford Chamber of Commerce Manager Declan Riddell said: “The office is now open for client meetings and Chamber events and we can’t wait to welcome our members to the space in the coming weeks and months.

“It’s placed perfectly in the heart of Stafford and has ample short and long stay car parking just a short walk away – and is also a walkable distance from Stafford station.

“We will continue to offer our award-winning support to the local business community, whether it’s a fledgling start-up entrepreneur or long-established enterprise.

“Shire Hall is a jewel in the crown of Stafford landmarks and we’re very proud to call it home.”

Described as “one of the finest public buildings in Stafford”, Shire Hall was constructed in 1798 and served as a courthouse and art gallery.

Find out more about Staffordshire Chambers of Commerce, here.

Businesses and households are being urged to recycle their unwanted ‘e-waste’ in light of a new study that estimates that 5.3 billion mobile phones will be thrown away in 2022 alone.

Research conducted by the Waste Electrical and Electronic Equipment Forum (WEEE) suggests that electrical and electronic waste will grow to 74 million tonnes a year by 2030 – a problem described as one of the ‘fastest growing and most complex waste streams that affects both human health and the environment’,

Old electronic devices such as laptops and phones, known as e-waste, can offer many important resources that can be recycled for use in electronic devices such as wind turbines, electric car batteries or solar panels – crucial for the transition to low-carbon societies.

In July of this year, Staffordshire Chambers launched a new charitable e-waste initiative in partnership with the Stone Group and the Elm Group to help tackle growing e-waste levels across the county.

Businesses and individuals can hand over their old electronic devices to be securely wiped using MOD-approved software, before being re-used or recycled for parts.

In return, Stone Group will make a charitable donation to support the work of A Child of Mine, a charity that provides emotional and practical support to bereaved parents and families.

Find out more about the initiative, here.

With energy bills in the news, businesses of all sizes are keeping a close eye on how much they’re using day-to-day.

We know that business owners are working flat out to keep their business running and might not think they have the time to start thinking about their energy usage.  However, there are some simple hacks out there which can help businesses to cut their costs as the colder months draw in.

For instance, did you know that in a single three-bedroom house, turning the thermostat down by one degree can save 10% annually, according to the Energy Saving Trust. So, imagine what dialing down the temperature by one degree in your offices could do for your business.

Here are five more simple and effective ways for SMEs to reduce their energy consumption this autumn:

• Let’s start with a straightforward one! Don’t forget to switch off electrical equipment overnight
• Identify and defeat draughts and install wall insulation to stop heat disappearing
• Keep radiators, heaters and air vents clean to help them work more efficiently
• Make sure your thermostat is working correctly to make sure your boiler isn’t generating more heat than it needs to
• And consider a smart meter, which could help your business avoid spending more on energy than it needs to, by providing insights on how you’re using it

Smart meters offer SMEs a range of benefits which could come in helpful at the moment.

They could help make your budgeting and forecasting more accurate as you only get a bill for what you’ve used, and they could give you valuable insights into how your business uses energy, day, and night.  Plus, they automatically send readings to your energy supplier – so you shouldn’t have to.

Firms with 10 employees or less could be eligible for a smart meter.  To find out more please click here.  You can also contact your energy supplier or broker.