There were about 40 attendees and a lively discussion ensued.
The Panels initials thoughts
Stuart Paver – cash is king, more important than profit. Understanding your market is key. For Pavers Shoes our customers are generally a bit older. The 25-45 yrs old age group generally have a cash problem at the moment.
Tom Brown – yes cash is king, don’t enter a recession with too many staff. Paying your suppliers on time is vital
Daniel Carlton – forecasts are vital. Nobody knew what the norm would be with pandemic, Ukraine etc
Simon Palmer – Azets came through Covid-we learnt how to deal with big problems. X went bust because a major customer went bust. Xero has their chaser (for £75pm). Recessions happen approx every 15 years. Think about what you should do to anticipate it.
Stuart Paver – beware of supplying people on credit; banks need watching. Sometimes better to give up your full price and get cash flow instead
Tom Brown – don’t enter a recession with a bad balance sheet-ie don’t have much debt. Overdrafts leave you vulnerable-term loans may be better
Simon Palmer – plan ahead, get invoice discounting. Set up a facility for when things get difficult giving you say 3 months protection
Stuart Paver – we can now measure what each customer costs. Look at discretionary costs-what worked for people in previous recessions
What have you Learnt
Stuart – managing the cash is all important; unlike others in your sector you’ll be able to expand if you’ve got the money. Get family aligned before a recession
Daniel – sales people must talk to the credit control team. Bounce back loans are terrible; 46% increase in insolvencies this year but April/May may be better
Simon – in the 91/92 recession Armstong Watson (accountants based in York) made 6 people redundant