Business on the verge of collapse!
Glad I found this great forum. I'm hoping you could perhaps give me a little advice on my situation.
I run a small service company (Ltd) with 10 staff total and this year the economic situation has made things very difficult for us.
We are just managing to hold our heads above water but are losing on average about £3k per month. This is slowly eroding our bank balance to the point now that all our working capital has gone and paying staff salaries is pushing us into our overdraft every month.
We are doing lots of speculative things to try to increase turnover and profits but non of these are particularly short term. The business is still solvent... just, but I need to cut some overhead before things go critical.
We do not owe any money out to suppliers really, so the only regular creditors are the bank (mortage on property), business rates and staff salaries.
Of all these, staff salaries is by far the biggest. I have already cut director salaries to the bone and have implemented a 4 day week but I really could do with making a couple of redundancies. The problem is that all the staff have been here for many years and I just don't have the cash to pay redundancies.
It's a awful situaltion because I know the company could be profitable again if I cut some overhead but with no cash to do it I feel like we are trapped.
I really don't want to go down the road of a CVA if I can help it (and would it help much anyway if the main problem is staff salaries). Are there any other options?