There are many different reasons that a company may need to close down for a limited period of time. Reasons for a temporary business closure may include staff illness, natural disasters or cash flow problems. Temporary business closure may be voluntary, or at times forced, as we have seen in recent years with the lockdown restrictions introduced during the Covid-19 pandemic.
Temporary business closure can be difficult to navigate and so it’s important to put a few key measures in place to ensure that your company can return to normality when you’re ready to re-open. If you’re planning a temporary business closure, make sure to consider the following factors:
Communicate With Your Employees
It’s only natural that your employees are likely to feel concerned at the prospect of a temporary business closure and so it’s essential that you keep communicating with them and maintaining transparency. You need to be clear on how long you intend the temporary business closure to be in place for and what this means for the terms and conditions of your team’s employment. It’s important to communicate your plans as early as possible to your employees, and make it clear if you are planning on bringing the full team back when the company is open again.
Notify Your Customers
It’s also essential to notify your customers of the temporary business closure, emphasising the fact that it is not a permanent measure and you will soon be back to business as usual. This is important for ensuring that your customer base returns after the period of closure. Put up signs on the premises before the closure is due to take place, and spread the word via your usual marketing channels, which may include social media and email. Whilst the company is closed, if you can, you should post regular updates on your business’s social media to keep customers engaged and updated.
Reach Out To Suppliers, Service Providers & Creditors
It’s vital that customers and employees are notified of the temporary business closure and the same applies to suppliers, service providers and creditors. It’s important to communicate your intended timeline to these parties and demonstrate how you intend to meet any financial obligations during the period of temporary business closure. This is essential for maintaining these crucial relationships so that you can get straight back on track once you’re ready to open the business again.
Organise Your Finances
As you can imagine, financial planning is vital when organising a temporary business closure. It’s crucial to ensure that you have the funds to fulfil all your financial obligations throughout the temporary business closure so that your company is in good health by the time the closure ends. Contact your bank to discuss any financial support that you may have access to, and set out a payment plan to ensure that you stay on track.
Seek Business Rescue Advice
If you’re decided to plan a temporary business closure due to cash flow problems or other financial problems then you should use the time that your business is closed to put a rescue plan in place. The period of closure will give you the breathing space that you need to look at where your company is weak, and where restructuring can be put in place to re-stabilise the company and return it to profitability. A business rescue expert can work with you to put measures in place that are best suited to the individual requirements of your company.
Maintain Accurate Records
Keeping organised is essential when handling a temporary business closure. Aside from maintaining accurate financial records to ensure you are on track with meeting all obligations, you should keep a record of key dates. This will include records of closure dates, employee details and details of any transactions that you may have made during the shutdown period. This is really important for demonstrating that you are meeting all necessary obligations and doing everything by the book.
Ensuring you plan your temporary business closure effectively should ensure you can return to normal when you’re ready to reopen. However, in the event that you do find your company in financial difficulty, you should consult professional guidance as soon as possible. Our experienced team at Ballard Business Recovery are here if you need us. Looking at your business’ requirements on an individual basis, we can help advise you on the best path forward for recovering your company.
