Many business owners are currently preparing for the new tax year, where more of the announcements from the Autumn Budget will be keenly felt.
While rising costs are a concern for many, many businesses do face closure within the next 12-months.
Some of these are the zombie companies that are currently shambling around and you need to know how your business will be impacted if they close.
What is a zombie company?
If a business is only making enough money to cover its running costs and nothing more, then it is considered a zombie company.
While the term does seem a bit harsh, it reflects the sentiment felt by competitors who are trying to be more dynamic only to have resources absorbed by zombie companies.
The presence of zombie companies is representative of the ongoing struggles faced by many businesses attempting to keep up with the rising costs they face.
Low interest rates have allowed businesses to take out more loans to stay operational even as they struggle to balance costs with working capital.
These working capital loans should only be used as a short-term solution to allow a business to get into a better financial position, but many businesses are becoming reliant on this form of support.
How can your business survive the apocalypse?
With operational costs set to increase, it is expected that many zombie companies will be wiped out.
This should be positive for the economy in the medium and long-term, but there will be a short-term struggle that needs handling.
It will be most keenly felt by those who are employed by the zombie companies that will struggle to find new employment in an already competitive job market.
However, for businesses that can endure this time of economic turbulence, the fall of zombie companies might present an opportunity.
Customers and clients who were previously occupied by the zombie company will be looking for a new business to help them.
Similarly, former employees of zombie companies who may have struggled to feel fulfilled before could make a valuable addition to the team of a growing business.
As zombie companies are often viewed as a barrier to broader economic growth, their removal will allow for more dynamic businesses to operate efficiently.
To ensure that your business can be one of the dynamic companies weathering the storm, it is important to seek professional financial support.
Our expert team can help you manage the rising operational costs by identifying ways to improve your cash flow without becoming overly reliant on short-term solutions.
For expert support that will breathe new life into your business’s financial goals, speak to our team today.
