1. Assess Your Financial Position
- Review cash flow, liabilities, and assets
- Identify overdue invoices, outstanding loans, and key creditors
- Determine how long you can continue trading under current conditions
2. Seek Early Advice
- Contact your accountant, solicitor, or financial adviser
- Access free support via your local Growth Hub or Chamber of Commerce
- Consider speaking to insolvency practitioners before problems escalate
3. Communicate with Creditors
- Be transparent about your situation
- Negotiate payment plans, discounts, or extensions
- Keep detailed records of all communications
4. Explore Support Options
- Time-to-Pay arrangements (for taxes with HMRC)
- Debt restructuring or refinancing
- Invoice finance or asset-based lending
5. Review Viability
- Determine if the business can realistically recover
- Identify core profitable areas to focus on
- Decide whether to continue, restructure, or close
6. Consider Formal Procedures (if necessary)
- Company Voluntary Arrangement (CVA) – restructure debts while trading
- Administration – protect the business and jobs while seeking a buyer or restructure
- Creditors’ Voluntary Liquidation (CVL) – controlled closure if recovery is not viable
7. Protect Yourself as a Director
- Understand your duties and responsibilities
- Avoid wrongful trading and personal liability
- Seek professional legal and financial guidance
8. Plan for Employees and Stakeholders
- Communicate openly with staff
- Provide support for employees affected by potential closure
- Keep suppliers and customers informed to maintain trust
9. Document Everything
- Maintain thorough financial records
- Track all steps taken to manage the situation
- Documentation helps in negotiations, legal processes and protecting personal liability
10. Learn and Prepare for the Future
- Conduct a post-crisis review to understand lessons learned
- Implement better cashflow monitoring, risk management, and contingency plans
- Build resilience against future financial challenges
