Our clients and other companies are reaching out to RfM to help them to navigate their way through the crisis with their businesses intact. In the spirit of + more, we are doing what we can, where we can, to help them through.
*** UPDATE 6 May 2020 ***
The Leaders Council Podcast
RfM Partner, Paul Newsham, recently took part in a second podcast for The Leaders Council. In his interview with Scott Challinor, Paul discusses the impact of COVID-19 on RfM clients and their businesses, his own experiences as a business owner, plans for the future and what he has learned from the crisis.
It’s fair to say that we’re all getting tired of the phrase ‘unprecedented times’ (as well as its alternatives: challenging, extraordinary and difficult) but the truth is, we are indeed experiencing a period in time that we have not prepared for. Accountants train for many years and throughout their careers to gain the credentials to advise businesses, yet a situation such as this isn’t covered in any syllabus on any course on accounting or tax. This is the stuff of sci-fi novels, not textbooks!
Nonetheless, we have found that business owners are looking to us as the trusted advisors who will help them plot a course through the crisis so that they still have a business “when this is over”.
“From providing clarity on the government’s support measures and help with loan applications to strategic advice on how to adapt to trading with social distancing, we feel privileged to be in a position to make a difference,” says RfM Partner Paul Newsham.
“Our brand ethos of + more has never been as apparent in the actions of our staff as it is right now. Despite their own challenges of a heavier workload and adjusting to working remotely, they have all shown an admirable commitment to doing whatever they can to help clients.
“Following each announcement of support measures from the government, our staff have had to quickly get to grips with the ins and outs of new initiatives so that we can deliver them effectively and at pace.
“Like our clients, we too have had to make difficult decisions. The impact of social distancing is so far-reaching that every type of business has been affected in some way. We care about every one of our clients but have had to prioritise based on urgency and greatest need.”
Help to access support loans and grants
Much has been made of the apparent barriers to accessing the government-backed support loans from high street banks and other lenders. Following revisions to the scheme, the money is now starting to reach businesses that meet certain criteria. We have been supporting clients to gather the evidence they need to qualify including:
- Up-to-date accounts information to demonstrate that the business was viable pre-crisis
- Projections for the next 12 months to give an accurate picture of how much funding is needed and for what purpose
- Proof that the loan is serviceable.
Supporting clients to stay in business
Here are just a few examples of where RfM has helped bring about some positive outcomes for clients in recent weeks:
A hospitality services group (pub/restaurant/hotel) has secured a £220k support loan via a high street bank. This will allow them to pay overheads and costs and ensure they can resume business, once permitted to do so. RfM assisted with preparing the required projections and facilitated the arrangement through our long-established relationships with the bank. Our clients’ staff have been furloughed under the government’s Job Retention Scheme.
• A small distributor of hygiene equipment and parts has been able to secure a loan of £100k for much-needed working capital and to cover fixed costs. Its employees have been furloughed.
• A medium-sized financial/professional services business has accessed £200k+ of funding.
The money will ensure they can pay staff and costs so that they can continue delivering services, despite the impact on cash flow caused by the crisis.
In all cases, RfM’s strong, established relationships with banks and lenders have helped to speed up the process considerably.
A proactive approach
Sadly, not every business story will be one of success and, as a fellow small business, we empathise with those businesses that are unable to pull through.
“Although some will fail through no fault of their own, we advocate taking a proactive approach to improve outcomes,” says Paul. “Do not spend too long thinking about whether to seek support or make operational changes – now is the time to take action.
“We have noticed three defined stages in response to the impact. Some business owners seem to get stuck in panic mode. Those that quickly move on to the third phase are the businesses having the most positive outcomes so far.”
3 stages of business response to the crisis
- PANIC / INERTIA – Businesses can be overwhelmed and paralysed by the enormity of the situation and see only negative outcomes e.g. my business model doesn’t work under the current rules, I can’t survive with no income. Try to avoid focusing on the ‘what ifs’ and worst-case scenarios: What if my clients cannot pay me? What if I can’t get supplies? What if my clients decide to stop buying from me? You may find that none of these outcomes actually happen.
- EVALUATION – Step back and appraise whether the worst has actually happened, what the impact has been, where you can go for help. Ask for advice, make a plan, decide to take action.
- OPPORTUNITIES – Take advantage of whatever help and support there is out there. Adapt the business model to continue generating income, explore new routes to market, spot opportunities, speed up R&D to bring products to market. Look further into the future and refine or develop new products/processes whilst trading is ‘on pause’. Simply take the opportunity to work ‘on’ the business that you’re always working ‘in’.