Sometimes, despite having an exciting, original business idea, a clear business plan, cash reserves, and a passion for your business sector, you can still find yourself struggling to gain traction and make a splash in your market – so it’s important to know when to cut your losses and move on is key.
Whilst this can be disheartening, failure is exactly what many entrepreneurs actually need to learn – it provides lessons vital to enabling future success.
Business Recovery & Insolvency is a core facet of advisory and accountancy companies, aiding businesses experiencing financial distress, tax difficulties, and significant debts to identify the best way forward for both the business and its directors/shareholders.
BRI does exactly what it says on the tin: aids individuals and/or businesses to recover during financially precarious times through expert advice and analysis, or helps an insolvent business to wind up in the most efficient way possible.
Jungletastic
In 2020, every business across every sector and industry experienced some ill-effects as a result of the pandemic – a global issue that no-one could have predicted but that had a profound impact on public health and the economy.
A popular children’s indoor soft play centre based in Nuthall, Nottingham, Jungletastic was – like many other businesses – forced to enter into lockdown as a result of the pandemic, having a catastrophic effect on trading numbers.
Initially, the family-owned business was forced to close due to the first lockdown in March 2020. Whilst they reopened in the autumn, the restrictions and social distancing expectations put in place from September 2020 were damaging to trade and finances, making it virtually impossible to continue.
Overcoming the Challenges
Despite owners seeking advice early on from PKF Smith Cooper’s BRI Partner, Michael Roome, it was clear that there would be no way for the company to adapt to restrictions – particularly when it was unclear just how long they would need to be in place.
“Our 2 families set Jungletastic up in 2008 in the very popular area of Nuthall, in a run-down building that had been left empty for nearly 2 years. The decision to permanently close has been the hardest one that we have had to make after all these years but due to Covid-19 and the foreseeable restrictions, we are no longer able to sustain the business.”
Sarah Simmonds, a Director of Jungletastic
There are always going to be bumps in the road and issues that are outside of your control when you set up a business, so closure doesn’t necessarily mean failure. Sometimes, you’ve got to brush yourself off, put the situation in perspective, and get back on the horse with the lessons you’ve learned.
For aspiring entrepreneurs, the key lessons that can be taken from this example are: 1) know when to cut your losses, and 2) seek advice as early as possible to identify all avenues available to you.
Why are these important? Well, making a definitive call early on is much more beneficial for you, financially, than dithering. Holding out can cause the business to accrue debt and reduce sale options, if that route is available to you, whereas seeking advice can either help to save the business or conclude it in a way that’s best for shareholders, staff, and clients.
How PKF Smith Cooper can help you
If your business is in a slump or you’ve had a bad prior experience, try not to be too disheartened; the lessons learned from it could be exactly what you need to get your next venture off the ground.
Noted for our tailored, sincere, and comprehensive approach to Business Recovery & Insolvency, our award-winning division is a leading Insolvency practice, offering a wealth of solutions to those facing financial pressure/duress.
The experts within PKF Smith Cooper’s BRI team can help you whatever your situation, helping to determine your financial position and discussing the best strategic options for you and your business to adopt moving forward.
When your business is in distress, the demands on your finances are high with cash not readily available. That’s why your initial meeting with PKF Smith Cooper’s BRI specialists is free of charge – to ensure you get the best possible advice and guidance without having to worry about the financial implications.
So, whether you’re a creditor owed money by an individual or company, a director or shareholder in financial distress, or an individual with debt, get in touch with PKF Smith Cooper’s BRI team and see how we can help you today.
