how can i stop someones buisness from going bust.?

Question

A friend has lost a buisness partner and the company is under pressure,it is a small project.
What can be done?

Answer 1

focus on the core business and be ruthless when accounting

Answer 2

I own an accountancy business and am currently dealing with a client in a similar situation. We are working together to try and turn the situation around and bring the business back into a profit making position.

You dont say what type of business it is of who it is under pressure from but I would assume that it is bank or other creditor pressure.

On the assumption that the remaining partner is able and willing to continue the business the first step would be to bring the accounts up to date possibly also preparing management accounts relating to before and after the loss of the partner. If you do not already use an accountant now would be a good time to look into it for their support. e-mail me if you would like a quote.

On the creditors side make sure that a full list of all creditors is made together with amounts due to them and a note of any credit terms and place them in order of importance from government agencies and staff thorugh banks, loans and finally trade creditors.

It would also be a good idea to get your friend to compile a list of their own personal liabilities and any securities held on their assets.

Once you know how much is owed and to whom you can then look at the profit and loss side of the accounts and examine them to see if there are any money saving areas, for example by switiching insurance providers a saving can be made or by using different suppliers you may be able to make a small trade off between cost and quality. Ensure that all of these matters are documented.

Finally you need to assess whether turnover can be improved athough this may require some short term expenditure eg advertising.

When all of these matters have been looked at it is time to deal with the creditors. If it is mainly government agencies which are owed money to it may be possible to come to some arrangement with them regarding payment such as extending the time allowed to pay personal tax or VAT. In dealing with these agencies wherever possible inform them of the situation and what is being done to correct it.

The second step would be to go to the bank, again with the information collected and a business plan for the immediate future. This will reassure the bank that you are on top of the matter and actively trying to find a way out of it and make them more disposed to assist you with loans or better terms.

Then only if absolutely necessary inform selected trade creditors of the situation, remember that peope talk and do not expect to keep the situation a secret if you really have to inform some of them. If tht does happen you are likely to find that credit terms are removed and COD is the only way peope will trade with you.

FInally remember that no matter how much you may all want to keep the business alive it may be that the only reasonable outcome will be to close it before your friend takes on too much personal debt keeping it afloat.

Hope this helps

Jus

Answer 3

It really depends on the situation, as someone who turns busines around on a daily basis, there can be a lot of different approaches to a problem.
Before doing anything, your colleague needs to speak to their creditors, they will usually be understanding if it's handled correctly. Most of them are after all small business people.

You first need to find the source of the problem it will generally come down to one of three things:

Not enough money coming in
Orders not being put through efficiently
Money being counted badly

The first stage is to look put some figures in place, track how many orders are coming in, how much each one is worth. There are cases when people just aren't charging enough. There are other times when the volume of sales isn't enough. This first part comes down to either putting your prices up or increase your sales effort.

If your getting the work in and it's nice and profitable then look at the operational side of the business, cutting costs is usually a favourite for this, but making the whole operation more effective can also prove to be as useful. Remember if you save a £1 you gain a £1 proft - well before taxes etc, but you get the idea.

And if it's no of those then generally it comes down to a financial management problem. How is money being drawn fro mthe company - is it structured or a bit hap hazard. If it is hap hazard, this generally indicates poor financial controls, the company accountant should be able to help with this side

Answer 4

The only cure for not enough cash in the business is to put more in. The hard question is whether it would be good money after bad. Personal issue is being generous now could cost the friendship in time. If it's a small amount and if you can/will gift it, waiting for a return gift is less fraught than looking for repayments. A real bankers answer from a real banker.

Answer 5

It's not that he's hating mexicans, it's just he hates that his own country sells him out to make a bigger profit! He lost a good paying job to a low wage mexican! He hates his childrens school is running over with illegals! He hates his cities hospitals are overflowing with illegals! He hates the crime that illegals bring to his city! He doesn't like all the drugs the illegals bring! He doesn't like all the gangs of illegals that are popping up everywhere! He doen't like turning on the tv to see a bunch of criminals with no better sense than to KNOW that they are criminals marching demanding rights! He sees how 3rd world our country is becoming! Yes lady your husband has a point, get out from in front of the liberal *** television! Open your eyes and take a good look around if it's this bad now what do you think it will be like in another ten years! It doesn't look pretty! by the way this asker is delusional!

Answer 6

There are no friends in business.
You have got to look at the figures and see if there is scope for the business surviving .
Don't put money in because it is a friend if it is a failing business it will fail and you are only being cruel by prolonging the life .

Answer 7

Batter it with money. This normally helps small businesses. Alternativly get in a business doctor to review the business and fault find to determine whats wrong with it and to make sure it is viable ona go forward basis.

Answer 8

pay a local accountant to review the business with you. One day should do it at a cost of no more than £500. Then you will know whether it is worth saving or not.

Answer 9

You could put shares into the company and become a share holder which means you wont have to do the work just have to help your friend financially

Answer 10

The only thing to do is inject money into the firm, but first you have to find out why the firm is struggling. Do not through good money after bad.

Answer 11

put money in is the only answer i can think of or try and get some one to back him what about dragons den they will put cash into a business if its a good one