Business under stress - what would you do?

tigh

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I'm a business owner under some considerable stress, and am wondering what you would do under these circumstances?

I've been in business for over 20 years, been in my current industry for 8 years - and it has been very good to me. The recent GFC however has cruelled me. I've gone from 36 staff to 16 over the last 12 months. My turnover is down 28%, while my fixed costs have not changed. I'm bleeding $12 - $15k per month. I've got a mortgage, 4 kids and 2 dogs, but my wife and I can't afford to pay ourselves a wage. I've got debt of $300k on the business plus a $100k overdraft. I've got the ATO chasing me for $40K of taxes (some of which is tax in advance on money I am yet to earn - and will not earn due to the current climate) and am accruing interest on this ATO debt. Heres the Q…..............

Do I hang in there and wait for the economy to turn (when the economy turns I believe we can get back to break even) - or do I shut up shop, pay out employee entitlements, payout the business debt and walk away?

Help me out here - What would you do?
 

steven_tiger

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Jesus mate, sorry to hear it's all gone wrong.

Very tough decision. Obviously family comes first. With a mortgage and kids it isn't easy to 'ride it out'.

Good luck with whatever decision you make.
 

Peaches

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I wouldn't walk away unless I had something else lined up. If breaking even is at its best after the GFC is over, than the business may not be worth keeping. Aren't they supposed to make money.
 

innsaneink

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...ahead of you....
Depends what you have to walk away to I suppose.

Just o/t for a sec, did you decide on some text for your tatt?
Spose thats least on your mind right now
 

tigh

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@innsaneink said:
Depends what you have to walk away to I suppose.

Just o/t for a sec, did you decide on some text for your tatt?
Spose thats least on your mind right now

That wasn't me Ink - but I threw up some ideas for him. Wasn't that Hemsley' Heardresser or King Sirro?
 

Blokarter

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I bought a mechanical repair business some years ago and as yet I haven't really felt the effects of the GFC. So I'm probably not in a position to give advice. But I have learned to concentrate on what I'm good at and be good at it. My core customers are my livelihood and they are whom I concentrate on.

Not knowing your business it's hard to give advice.
 

Suzie-Q

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I have no advice at all, Tigh, I just hope that you and your family come through this ok - that's the important thing…
 

NJLM78

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@Suzie-Q said:
I have no advice at all, Tigh, I just hope that you and your family come through this ok - that's the important thing…

Very well said. I'm sure everyone on here wishes the same for you.
 

system

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In a similar position mate. Little better off than you right now it seems.

Best bet is to hold out as long as you can and seek to diversify if it is a possibility. Rather than letting go office staff I made a deal with a large company to outsource clerical work to us.

That and walking away when the job market is so iffy is not the best.

Unfortunatley downsizing to the bare bones may be needed
 

Jazza

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Im not sure what you can do, I just hope you can get through this as best you can. I would try and hang on as long as possible, there is talk in the news that the economy may be showing signs of easing but the question is how long until a full recovery is underway!

Tough times at the moment, I wouldnt suggest you walk away just yet because people are still losing jobs everyday. I finished school in 07 and did a business diploma course last year to get some qualifications. It finished just after the crisis began, and since then, i havnt been able to get a job anywhere, my brother has been sacked from his job, and work has dried up for both my dads building and painting businesses, so its not a good time to be looking for work, and not a good time to start a new business if you did sell this one and start again.

I wish there was some way I could help ya mate.
 

HappyTiger

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Jul 13, 2009
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Sorry to hear mate..Im not a business owner but have been working in a small business for about 6 yrs which also fell on some hard times in the last 6 months especially.I know its not the solution to the problem but i think in this instance you do whatever it takes to survive.If it means scaleing back to bare basics then so be it.Times will change and the lessons learnt from experiences like this will prove invaluable in the future if you can ride it out.At the same time nothing is worth driving yourself and family into the ground over.Life goes on and i know its cliche but when one door closes another usually opens.Ive found that in my own situation.Keep your chin up mate.You can turn this into a positive experience.
 
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