Little can be more depressing than seeing your business reduced through no fault of your own. But as the saying goes, when the going gets tough the tough get going. So what can you do once you are over the first difficult decisions which inevitably involve arranging home working, laying off staff and reviewing overheads?
The tips we suggest all involve the firm belief that business will return in the not too distant future. Historically, the recruitment sector is the first to recover from any kind of down turn, as employers once again look to rebuild their staff banks and productivity, so those in the sector ready for the upsurge will be clear winners. Our tips reflect our extensive experience as advisers in the sector during the good times and the bad. We have seen how mistakes and loose ends have crept into performance and profitability as pressure to deliver more, ever faster, has risen. Now may be a good time to reflect and prepare your business to be ahead of the recovery curve rather than behind it.
Tip 1 – Make sure you know the ‘furlough’ rules. Government support on VAT and loans may help fund you through the difficulties, but knowing what you can recover and how the rules impact on employees, agency workers and contractors can inform your decisions.
Tip 2 – Keep on top of your credit control. This may sound simplistic and obvious, but experience already shows that some hirers are using Covid-19 as an excuse for withholding their agency fees. Sympathy is all well and good but non-payment to you probably means that you will not be able to pay the workers who your hirers have used without putting great strain on your business. Do not let Covid-19 be used as the excuse. Stick to your normal credit control policy. The down turn may push some hirers over the edge but otherwise previously healthy companies probably still are healthy. You should claim your debt as soon as possible. Healthy companies will pay. Delay cannot work in your favour and lodging an early claim could result in early payment.
Tip 3 – Make a record of those contractors or agency workers you were supplying at the time of layoff, and the companies they were supplied to, and stay in touch with them. Most hirers may well ask you to resupply in due course, so be at the ready, and check your contractor’s availability.
Tip 4 – Lock down payment arrangements with workers who may not be covered by the government’s Job Retention Scheme. Nothing appeals more to a contractor than knowing you are working hard to secure funds for them, and plenty of hirers may well be keen to secure future service. Also no one wants to let a competitor in, and who knows what may be going on behind closed doors! Get an agreement in place (contact us if interested) and safeguard your deals.
Tip 5 – Keep your humour and confidence up! Now is a good time to prepare, albeit possibly early days for implementation. Let us know if we can make your lives easier.