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If your business can’t wait until January for the retention bonus scheme, Simon Michaels, CEO of HW Fisher Business Solutions outlines what you can do in the short term to survive…
Last week, the Chancellor announced a £1,000 bonus for any furloughed staff that businesses retain. This is the latest measure to support businesses and bonuses will be issued to UK employers for every furloughed employee that remains continuously employed through to the end of January 2021. Payments will be made from February 2021, which is a lifetime away in our current economic market. What can businesses do in the meantime?
It’s important for businesses to complete a forecast, but accuracy is near-impossible in the current climate of uncertainty and without a crystal ball – remember this is just one part of the planning…
Businesses who are agile and can react quickly to an unpredictable market tend to fare better than others who stick to rigid models and operating structures. It’s easy to follow a template approach when conducting a forecast. Instead, take a flexible approach review your fixed costs – this does not necessarily mean reducing costs, but shifting your cost model from fixed to variable:
• Review staff contracts – can you shift to contractors rather than permanent staff? One of the biggest costs to business is staff. In the services sector, this can be up to 70% of costs.
• Review lease agreements – consider moving to serviced offices and remove long term liability for long leases.
• Consider outsourced support – back office/admin support can be outsourced, reducing both fixed overheads and the need to house support staff.
It is also important to hold back on cash where possible. Don’t forget Government-backed schemes and deferred payments need to be repaid and this hits in Q1/Q2 of 2021.
Contact Simon today to discuss making a plan for your business.