How to protect your business and grow during COVID-19
No business will have escaped the effects of COVID-19 – albeit all businesses are being affected to different degrees. Plans drawn up for 2020 were either ripped up or swiftly revised in March at the start of what is predicted to be the largest downturn in over 300 years.
Huge events like this expose every business. In times of growth, business recovery plans are rarely checked. No business could have reasonably foreseen a pandemic of this nature and indeed, most contracts did not make provision for it.
However, a robust business recovery and development plan that is agile and which is then continually updated should now be helping organisations to navigate their way through and out of all of this.
This article looks at just a couple of the things that many businesses could consider as part of any such plan. If you would like a free template business recovery and development plan, or advice and assistance with one, we work collaboratively with many local accountants to get you started and then support you as required – just ask!
The purpose of a robust business recovery and development plan is to protect and grow your business. The plan will require some detailed thought and professional support, but now is the time to be doing it if you have not already. The plan will cover a whole host of areas such as funding; revenue; outgoings; budgets; opportunities; risks; working practices; technology & systems; communication; workforce; and innovation & adaptations.
Corporate Restructuring: Many owner-managed businesses will have worked tirelessly for years in order to build a strong business with valuable plant, equipment, premises, intellectual property, or cash reserves. Any business recovery and development plan should plan for all eventualities and make sure that all the hard work over the years does not get undone (for the business owners, their employees and other stakeholders) due to something they cannot control.
One of the best and most tax efficient ways of doing this is to protect the key assets of a business from future risks and uncertainties by implementing some form of corporate restructure. Although this may sound like something suitable for large corporates, it can be just as useful for small businesses and can be relatively straightforward to put in place.
For example, one such method is to place a parent company on top of a current limited company and then transfer assets into that parent company in a very tax efficient manner. This results in key assets being protected from future risks and uncertainties, whilst keeping the assets available and in the arsenal of the business, to be used as and when required. We work closely with accountants to get the right corporate, financial, tax and legal structure in place for your business.
Protection of businesses and assets will need to be at the heart of all plans going forward and this can encompass a wide range of other areas, including transferring assets/businesses to spouses, wider family members, or into trusts; making sure you have up to date Wills in place; having robust business agreements prepared (including between stakeholders); and making sure appropriate insurance (life cover, keyman etc) is not overlooked.
Collaboration: Something that has been commonplace between public and private sector entities is likely to be one area of opportunity going forward for many private sector businesses. Put simply – think creatively and from your customers’ point of view about how you could work with other businesses to grow both businesses simultaneously. Then look at how to do it and get started.
Working collaboratively can result in you getting more work done faster, sharing costs and providing better goods and services to your customers/clients. Magic things happen when a group of businesses with different perspectives and skill sets work together towards a common goal. Initiatives of this kind can easily be governed cost effectively by collaboration agreements that confirm what each organisation is contributing, what they expect from it and how all parties can share in future success.
The COVID 19 crisis is sure to add fuel to this way of working. All businesses should encourage open-mindedness, reward innovation and celebrate success.
If you need further advice on protecting or growing your business, then contact James directly via james.peterson@GAsolicitors.com or calling 01752 203520 for a no obligation conversation.