Make the cash position visible
When a business faces financial pressure, begin with facts that can be acted on. Reconcile available cash, list payments falling due and distinguish confirmed receipts from uncertain collections. A short-term forecast is more useful than an unexplained bank balance.
Separate the company's obligations from the owner's personal spending and guarantees. Mixing the two can obscure the problem and make the next decision harder to assess.
Prioritise obligations with appropriate advice
Identify payroll, lenders, suppliers, tax and contractual commitments. Review the consequences and available options before deciding which payments to defer. Do not assume that the largest or most persistent creditor should automatically determine the plan.
Where the company may be unable to meet obligations, obtain relevant legal and financial advice promptly. An informal payment plan should not be treated as resolving the company's wider legal position.
Improve receipts and control spending
- Follow up overdue customers with clear records of amounts and disputes.
- Review unbilled work and unnecessary delays in invoicing.
- Stop unapproved discretionary commitments.
- Check stock, subscriptions and duplicated purchases.
- Discuss workable terms with counterparties before a missed promise.
Avoid cutting controls or replacing reliable records with optimistic estimates. A weak approval process can create more exposure at the time cash is already scarce.
Assign actions and review frequently
Use a concise action list showing the task, owner, date and expected cash effect. Compare actual movements with the forecast and revise assumptions when evidence changes. Keep a record of agreements with suppliers, lenders and other parties.
A business under pressure should also understand its underlying profitability. A temporary collection problem needs a different response from a model that loses money on each sale.
Keep the support practical
Share a controlled briefing pack with the people advising the business: accounts, debt schedules, cash forecast, major contracts and known disputes. Explain the uncertainty openly. Professional support should clarify choices and consequences, not promise that every financial difficulty has an easy solution.
