I’m grateful to you all for ‘cutting and pasting’ my letter (or a version of it) to the Chancellor regarding the plight of Limited Companies. I have also seen two letters from MP’s also making similar requests for help.
If you haven’t, but are able to send a copy, then once again I urge you to do so. This is a time-based thing. If you don’t do it now, the moment will have passed. This is not something that can be picked up in 30 days.
Here is his email address: rishi.sunak CEU.enquiries@hmtreasury.gov.uk

Options

Although it may seem tremendously optimistic at this time of monumental uncertainty, we must do what we can to take control. I have written at length about the importance of making a plan and I am delighted that so many of you have done so. But for those of you who haven’t, you need to. Now. I, or any of my team, would be more than happy to talk this through with you and show you how to approach the subject. Don’t forget to include;

  • Collecting outstanding debtors (money due to you from your customers)
    • how much you are likely to receive
    • and when you are likely to receive it
  • Income from current sales (if you are able to make any)
    • how much you are likely to receive
    • and when you are likely to receive it
  • Grants
    • £25k if you are in Leisure, Retail, hospitality
    • £10k if you are a ’small business’ paying little or no rates (through exemption)
    • Job Retention Scheme Grant –  the Furloughing of Employees
  • Postponed payments
    • VAT
    • Rents
    • Rates
    • Finance agreements
    • Loan payments

In the meantime, and in the absence of any further support, if you are looking like you are going to need some cash then I suggest your approach is as follows;

  • Identify all possible lenders;
  • Make an application to all lenders
    • Those that are partners with the British Business Bank (BBB) will assess you first on normal commercial terms. So that will be at their normal rates and security requirements.
      • If they say ‘yes’, then you won’t have the option to use the Government scheme (however, see anecdote below) – but will be expected to proceed with their offer/terms.
      • If they say ’no’ – then you will be introduced to the Government scheme
      • anecdote – we have been helping a client make an application to a BBB partner (in this case Nat West). Nat West accepted the business plan and offered terms based on the proposal including the need for a personal guarantee and therefore denied them the opportunity to proceed through the CBILS. However, one of my more diligent team had spotted that Nat West (and Royal Bank of Scotland) were offering not to ask for additional security if the loan proceeded through the CBLIS – so a re-application has been made (where it has been identified that the funding requirement is in fact greater than the original request, and above the lending threshold for the local Nat West branch) and therefore can be made under the CBILS. We are awaiting confirmation that this new application will not require any personal guarantees, in line with promises made by Nat West.
    • Where the lender is not a partner to the BBB
      • We have seen some good offers come through this channel, including, for example £100k, 5yrs, 5.3% unsecured. In any event that appears like a good result. There are probably many lenders who could offer this, but if you get stuck we are very happy to introduce to someone who is producing these results.

The point is to ‘go out in all directions’ and secure funding a soon as possible from;

  • an increased (or new) overdraft from your current bank
  • a loan from your current bank
  • an offer under the CBLIS
  • a loan from a specialist lender

Have them all on the table in front of you then choose the one that suits you best. The idea here is to have a choice, take control, not leave it to the last minute and be backed into a corner with potentially no offers.Once again, if we can help in anyway as regards to your forecasting, business plans, introducing you to new lenders, please let us know.

  • Landline – 01326 660022
  • Mobile/What’s App/Text – 07779799995 – Mike Hutchinson
  • Zoom – ID 205-677-7765 – Mike Hutchinson