The possibility of a double dip recession has been muted by many for some time now. The Chancellor has now announced his four year spending review; revealing a number of spending cuts to deal with the £155bn deficit and to try and secure the country’s longer term future without, he hopes, the country suffering a second recession. These cuts will inevitably affect the finances of many people and businesses, some to a greater degree than others. There will be 490,000 public sector jobs shed over the next four years and government departments will see their budgets cut by an average of 19% over the same period. There are many businesses that supply goods and services to these departments. So, not only is there a direct impact on the departments, but other stakeholders will feel the pinch too. Locally, it is expected that the defence budget cuts will have a similar impact.
Although we may all experience a financial squeeze going forward, with sensible planning and good advice we should be able to cope.
Below is an extract from an article I recently had published in the Southampton Daily Echo, which was in connection with coastal towns having some of the highest bankruptcy rates in the UK. I think it is relevant on the back of this week's news too.
“All too often, the Directors of businesses which are struggling financially do not share the burden with anyone and they certainly do not seek expert advice. When the business plan is not stacking up, we would recommend you look out for the early warning signs and consider:
1. are you delaying payments to suppliers?
2. are you regularly exceeding your overdraft limit?
3. have your lines of credit dried up?
4. are you struggling to meet the wage bill?
5. is the tax man sending you threatening letters?
A common sense approach is required, and if you find that you are spending too much time in the business worrying about the financials, then that is usually an early symptom of a struggling business.
Avoid letting the warning signs appear to be obvious when it is too late. hjs|recovery can help with our free, confidential financial healthcheck. This is designed to help you identify and focus on the problem areas, enabling you to work on the business and get back on track.”
Finally, thank you to all who sponsored our team – hjs|commandos – on the 2010 Royal Marine Commandos Challenge, held in Bicton, Devon on 10 October. So far we have raised £727 for the Devon Air Ambulance, and C Group (who support Royal Marines; particularly those suffering from long term effects of injuries sustained on operations). We completed the 10k course – a 3k run, 4k over the Royal Marines’ assault course and another 3k run – in 1 hour and 33 minutes, coming in 70th place out of 356 entries, so not bad, albeit rather tired, bruised, cut and blistered!
