Helping directors online for over 23 years.

Talk to us today in confidence:

Guide to cost cutting for my company

28th May, 2022
Keith Steven

Written ByKeith Steven

Managing Director

07879 555349

Keith is the author of the content on this comprehensive rescue, turnaround and insolvency website. He is the managing director of KSA Group Ltd - a specialist firm of turnaround and licensed insolvency practitioners. Keith was nominated for Turnaround Practitioner of the Year 2014 at the National Insolvency and Rescue Awards in 2014.

Keith Steven
cost cutting

When the economy is facing tough times is important to keep costs under control. 

I know how difficult it is to let Marge or Reg go, he has been with you for years; or Paul who arrived last year, or that whole department set up for that exciting new project that never floated off the ground. However, if your company is struggling you must take steps to preserve your business now. That may mean letting people go – regardless of sentimental attachments.

Read on for Company Rescue’s top tips, from the turnaround experts!

Listen guys, whatever the size of your business I can tell you something; you can always cut costs. No matter how many business people tell me they have already cut costs, I can always find more savings in their company. So don’t forget, control cash daily and be tough on costs to save your business.

Keith Steven Company Rescue September 2022

We suggest you print this page…

Our TOP 20 Cost Saving Rules and Cash flow Tips.

Common sense says: Only following a couple of these tips won’t work, using as many as possible will; The truth is the solution will come from a mixture of cost savings, driven marketing and sales, SHEER HARD WORK and a bit of luck thrown in. Once you regain control of the situation you can start to manage your cash flow problem.

We are still in, or just emerging from a serious recession now in the UK, does your business strategy reflect this? If not follow this guide and you will be better able to cope.

  1. Set up a daily cash flow to control all cash going in and out of the business; This my help protect you from wrongful trading, as it stops bounced cheques. If you don’t have a daily cash flow forecast click here for your free copy (downloads Excel spreadsheet) , email Keith Steven ( now or call KSA on 0800 970 0539 FOR YOUR FREE DAILY CASH FLOW MODEL.
  2. Make sure that all purchases are approved by you as the MD/FD/operations director/owner, and your partners. You should sign all cheques or approve all BACS/CHAPS payments in writing.
  3. No purchases are approved unless signed by you, which will make them produce a purchase order. Then you can check if they are doing their job, is the price fair, are they and your supplier ripping you off, or are they just lazy and not getting the business best value?
  4. No petty cash is drawn from the bank unless you personally go and get it – makes you question what every pound is spent on when people ask for cash, won’t it? By the way, you get out of the daily grind and time to think.
  5. Review all expense claims by the staff; reject all that are not really necessary. If you get complaints or murmurings (they may be too scared to act professionally and debate with you), then meet with them and explain the position.
  6. Remember survival is KEY. If you lose people or profits that’s not a vital issue, CASH IS KING for now. Profits will soon begin flow again from very tight cash flow management. If people sue for unfair dismissal, get help. KSA may be able to kill off their claims with straight talking. Or perhaps a CVA can kill these claims too.
  7. Ask every supplier for a review of their prices. Ask if they can cut you a better deal? You could also consider asking them too for a few extra weeks payment grace, or ask for regular monthly payments
  8.  Ask your landlord for a breather on rent. See if you can pay monthly rather than quarterly for a while? This helps cash flow. Technically this actually puts you in rent arrears, but that’s OK at this stage. Most landlords are very keen to retain their tenant and may be more forgiving than you expect.
  9. Similarly, ask your accountants to accept monthly payments. If your accountancy fee is £10,000 per annum, then ask to pay over say 10 months, that’s just £1,000 per month.MANAGE cash EVERY DAY! It may be that you need someone to do your bookkeeping for you. Have a look at our page on bookkeepers here
  10. Get someone else’s view on the situation; Do you have a trusted friend or mentor? If so talk to them about your business, actions and get them to sanity check you. They may be able to help you and suggest cost savings.
  11. Question whether you need your company car; Can you use your own and give it back? It may save you a lot of personal tax too.
  12. Ask yourself if you can you sell any assets, to raise cash? Make sure they’re not owned by a leasing company first. Shop around for the best deal.
  13. If you are factoring or invoice discounting, ask your factors to cut their costs, only drawdown funds weekly.
    1. Using your FREE daily cash flow model will of course help in this. CALL NOW FOR YOUR COPY 0800 970 0539
    2. This can save hundreds of pounds a week.
  14. Cut ALL overtime to the bone, why do you need it? Is your production planning so poor or weak? If you need more people hire them, at lower rates.
  15. If you need to make redundancies and cannot afford them, use the DeBIS  Hardship Scheme.
  16. Ask HMRC for a Time to Pay Deal, use our programme here is you don’t know what to do.
  17. Use the internet to buy or price everything; you can get fantastic value over the net.
  18. Work all hours, to build the recovery plan and set out the Time To Pay Deals with TAX AND VAT if you cannot pay tax debts on time.
  19. KEEP MINUTES or notes OF ALL DECISIONS. If you’re a partnership or sole trader KEEP NOTES.

We get paid to do this for companies large and small. We use the same process every time because it works and it can work for you. Take no prisoners, work hard, manage cashflow and you will hopefully lead your business out of the dark times.

See our page here – Ten Top Tips to Manage Cash Flow problems

If you have already cut costs, but you need help now, please call 0800 9700539 for quick accurate advice on your options.

Worried Director What Will Happen To Me After Liquidation?

in Company Liquidation What is …?

"A man in the pub said I cannot be a director of any other company if I liquidate my company. Is this true?"Actually, this statement is entirely false! Misconceptions like this frequently arise from individuals with limited understanding of the subject matter. Such misinformation can cause undue anxiety for directors considering liquidation, fearing it might personally affect them. Guess what? Listening to bar room experts, inexperienced accountants, or no insolvency specialist lawyers can stop decisions being made, this failure to make a decision is really what could land you in trouble. So how will liquidation affect me and how long does it take? Having a limited liability company means that the directors have little risk (or limited liability) if the company fails, as long as they have acted properly and acted in time. What is more, if as a director, you have been compliant and on the payroll for many years, you can actually claim redundancy from the government like any other employee. But, and it is a big but, if you fail to act in time, fail to act reasonably, fail to keep books and records, continue taking credit KNOWING that the company cannot possibly repay it, then you ARE at risk of personal financial loss or worse such as losing your house. So, act now and get help for your company and more importantly start reducing your own risks.Voluntary liquidation is the quickest most efficient way to deal with an insolvent company that has no future. As a director of an insolvent company, you are at risk if you do not act. This risk RISES the longer you don't act to put the company into liquidation.If you fail to act and the company is wound up by the creditors (compulsory liquidation) then the Official Receiver (OR) will be appointed to liquidate the business and he or she will investigate the activity of the directors and the business over the last 2-3 years. This is known as a conduct report on each director.  If the OR can prove there was wrongful trading where, for instance, you have taken credit from a supplier or took deposits from customers when you knew that it was highly unlikely that you could pay them back, then you could be made personally liable.This is known as the "lifting of the veil of incorporation" that protects directors under limited liability. If this happens then you could made liable for PAYE, VAT and creditors monies from the time that you should have known the company had no reasonable prospect of surviving the problems it faced.Additionally, the directors may face disqualification proceedings under the Company Directors Disqualification Act 1986 for up to 15 years, they can be fined and may face the loss of personal assets like your home, or even personal bankruptcy.Look, if you as directors have acted naively you may not know that you have broken these laws, but now you do know, it is vital to ensure that you protect yourself as a director by acting quickly to cease trading and put the company into voluntary liquidation; or consider a company voluntary arrangement if the company is VIABLE if the problems are solved. What is Creditors Voluntary Liquidation and what does it mean for me? In short, liquidation usually means, the company's trading stops and it's assets are turned into cash or "liquidated".All other possible liabilities, like employment liabilities, landlord's rent or payments to lease companies are stopped. It really is the end of the company, but the "business" may survive if a phoenix is organised. Liquidation is a powerful way to END creditor pressure and let you get on with your life. What if I have signed personal guarantees? If you have signed personal guarantees or indemnities to lenders, then the liquidation could lead to them being called in if the bank cannot get its money back from the company. There is little that can be done about that, but you should not delay decisions on liquidation to try and prevent a PG being called in: just think what ALL of the company's debts landing on your shoulders would do. Also it should be noted that HMRC now rank ahead of floating charge holders in any liquidation since December 2020.  Consequently, this may well mean that lenders that you have personally guaranteed will get less recovery hence exposing you more.All banks will agree a deal to repay the PG over time - provided you work with the bank to reduce their exposure.One great piece of FREE advice - always make sure that ALL tax returns, VAT returns and annual returns have been completed and sent in and that other "compliance" issues are dealt with wherever possible. These are important processes and will help protect you as individual directors. It shows that you have been acting properly.  I have heard about directors being able to claim redundancy in liquidation If you have been employed by the company and made payments via PAYE then you will be able to claim redundancy from the government and this is in fact a very simple process (20 minutes to fill out a form and we can help with that) so there is no need really to employ a third party to make a claim.  This process has been open to fraud so the HMRC are cracking down on operators that claim to be able to get money back when there is not enough "paperwork".  It isn't worth the risk.  If it sounds too good to be true then it probably is!You need to learn more about the options. This is clearly a general guide so, if you have any worries at all, please, just call us and we will talk you through the situation free and with expert guidance for your situation. Call one of our advisors or if you prefer, call our IPs (insolvency practitioners) now:Just one CALL will help relieve the stress and get you out of the mess.Why not call 08009700539 or 020 7887 2667 now?We could help you start the liquidation process today.(8.15am till 5.00pm; Out of hours call on 07833 240747, Wayne Harrison (IP)  or Eric Walls (IP) on 07787 278527)Finally, please remember this: NO BUSINESS is worth losing your health, relationships, marriages or your children over. Act properly, take advice, get the problem sorted and then get on with your life. In a little while the stress will go and you can focus on other things that are more important.Want more information on liquidation? Get our new free 2023 Experts Complete Guide to Creditors Voluntary Liquidation that covers Bounce Back LoansWe are experts in liquidation, voluntary liquidation, administration, pre-pack administration, business rescue, corporate rescue and company rescue, we can help solve your problems but only if you talk to us. Call 0800 9700539 for help.or email us your worries at 

Worried Director What Will Happen To Me After Liquidation?

Notice of Intention To Appoint Administrators

A notice of intention to appoint administrators is when the company files a document to the court to outline that it intends to go into administration if a solution cannot be found to its immediate financial problems. It can be used as part of the pre-pack administration process as well as used to restructure a failing business to avoid its liquidation.

Notice of Intention To Appoint Administrators
Man with umbrella

What Is A Winding Up Petition By HMRC or Other Creditor

A winding up petition is a legal notice put forward to the court by a creditor. The creditor petitions to the court if they are owed more than £750 and it has not been paid for more than 21 days. The application, in effect, asks the court to liquidate the company as they believe the company is insolvent.

What Is A Winding Up Petition By HMRC or Other Creditor

Related Guides

Related News

We can help you get out of the mess!

Call now for free and confidential advice