Trying to get back in front

Chortle_2

dottyanne wrote:

Hi Chortle - thanks for your offer of advice - i see youre more than qualified and i would really appreciate any advice you could give to me.

I dont really think that it can sustain us both , i am going to have to address this with OH, although i DO think as its his baby - it can keep him going.

OH does know were in debt and struggling but he just thinks things will get better when business picks up - its slow at this time of year.

Were in Computers etc..the problem is stock alone costs a fortune - the money to be made is probably in the virus removal area etc when there is no real outlay by us?? perhaps i can do a promotion on this to entice more interest??

Never had a business plan - so i dont know were its at??

I do however think if i had more of a separate income - ie enough to cover DD at least at home then the pressure would be lifted slightly - im gonna have to tackle this with OH - hes ill at the mo which doesnt make things easier as its like talking to a bear with a sore head.......

Your business actually sounds similar to one of my old ones, (sold it to an employee years ago). We ran it from an industrial unit, with a 'trade counter - so effectively it worked like a shop, without the astronomical rent/rates that shops come with. As long as you advertise effectively (and the most effective advertising is often the cheapest!) you shouldn't lose any custom because you're no longer on the high street. It might be worth looking into.

I don't know how long you've been in business, but I have to say I don't recall this time of year being particularly quiet (though it may be down to local areas to some extent) - have you noticed this trend over the years, or are you just going by how many customers youve got coming through the door? Our slowest time was always summer - people tend to stop paying out for computers etc when they're more worried about holidays! So it could be that you'll have more quiet times in the coming months.

It is a notoriously difficult industry to make money in, competition is huge, margins are tiny anyway, and they seem to shrink month on month. (Thats why I sold when I did, I wanted to get out while it was still making money, as I could see that the industry was getting tougher and tougher)

Without a business plan, do you know how much you need to turn over to break even? I'd include your hubby's basic wage in that, as obviously, he needs to be there for the company to make any money at all.

Re the stock costs being astronomical - Has OH tried playing suppliers off against one another, to get the best deal? The competition between distributors is huge, and they'll often undercut, and sell below cost, just to get business off of their closest competitor.

If you did persue a seperate income, it would definitely take the pressure off of the business. It really doesn't sound like it can sustain 2 wages. Perhaps if you have a seperate income, and business does pick up, you could pay OH more (rather than struggling to pay 2 of you) and you'd have even more coming in.

I would really suggest that you speak to someone in Business Link, or your local federation of small businesses. There may be local schemes/grants available to help you, or at the very least, someone should be able to help you make head or tail of where the business is, and if it is viable. Saying 'it's quiet, it'll pick up' is all very well, but often its not the case in reality. (not saying thats the case here, its too hard to tell without the details) It's sometimes too difficult to be objective when you're emotionally attached to a business (and you sound like you are, calling it OH's baby') but you do need to be realistic, and should cut your losses if it isn't working out.

dottyanne

Thanks Chortle - you really have made me see the light - gonna pick the right time - armed with the SOA i posted on here for you guys and push it under OH's face - he cant talk his way out of things then - can he?

We need to address this now - before it gets any worse - i do agree with that!

oh - here goes nothing!!

ms_london

Hey Dottyanne.

Well done on posting your SOA & telling you're other half - so happy that he responded well.

I have transferred your SOA over to word so it looks as though I am working, hehe & will post my thoughts as soon as I can.

Others have made some great suggestions already.

Have a good morning. xx

dottyanne

ms_london wrote:

Hey Dottyanne.

Well done on posting your SOA & telling you're other half - so happy that he responded well.

I have transferred your SOA over to word so it looks as though I am working, hehe & will post my thoughts as soon as I can.

Others have made some great suggestions already.

Have a good morning. xx

Oh ms_london - glad to hear from you!!

Have TRIED to tell OH the exact crap were in but he's still not that worried - the SOA i posted has now been printed out for him to read and weep! really scared of his reaction................

ms_london

INCOME

178.57 PER WEEK TAX CREDITS
50.00 PER WEEK CLEANING
90.00 PER WEEK DAD RENT
39.80 PER WEEK CHILD BENEFIT



358.37 PW 1,552.93 PCM



MONTHLY OUTGOINGS (PERSONAL)

ABBEY MORTGAGE (6.50%) – 774.30
T V LICENCE – 11.07
POWERGEN – 120.00
SKY DIGITAL - 42.50
DIRECT LINE (LIFE) – 20.05
DIRECT LINE (CONTENTS) – 36.36
UNITED UTILITIES - 49.82 What is this??
COUNCIL TAX – 98.00 – UP TO DATE
KIDS SCHOOL DINNERS/SNACK MONEY – 111.00
KIDS AFTER SCHOOL CLUB – 60.00
FOOD (APPROX) – 200.00
OH SMOKING – 125.00



TOTAL - £1,648.10



* Based on your monthly income of £1,552.93 (which doesn’t include maintenance £££ from ex or a salary for your hubbie) – with these monthly repayments, you are short of £95.17 a month.



* How much of the £111 is for school dinners & how much is for snacks? Could you provide snacks from home & just pay for school dinners?



*Kids after school club. Do they need to go to this? Or perhaps cut down?



* Food, check out the Old Style Board for ways on making your food go further – all things grocery shopping & ways to make your money go further in the home & all round old style.



* The smoking needs to go!! Obviously if your OH’s wage was set in stone, this could be included in the “incomings”, but since it isn’t guaranteed I don’t think it should be. Could your OH cut back? If the business cant afford to have two of you working there, what could he do workwise elsewhere? How easy could he (or you) find something else?



* What about budgeting for car tax/insurance/MOT? I noticed you included petrol, so do you put £££ aside for these things each month or just pay it off when it comes around?





DEBTS



* Are these repayments listed all your monthly repayments?

* What are your balances/how much do you owe on each one?



OVERDUE



GROUND RENT – 200.00 OVERDUE – TO BE PAID IN FULL
BARCLAYCARD – OH – O/S APPROX – 858.24 (LIMIT 700.00) OVERDUE- THEY WANT 175.00 ASAP
BT – HOME PHONE – 154.51 – OVERDUE ALL DUE
CAPITAL ONE CC – OH – O/S APPROX – 1015.00 (LIMIT 1000.000 OVERDUE – THEY WANT 130.63 ASAP
ROBINSON WAY DEBT COLLECTORS (BRITISH GAS) – OH – APPROX 608.00 – 20.00 PER MONTH – OVERDUE
INLAND REVENUE – TAX CREDITS OVERPAYMENT – 646.12 – OVERDUE SINCE NOVEMBER 2005 – NOT PAID ANYTHING!!



UP TO DATE



SCOTCALL DEBT COLLECTIONS AGENCY (DSS) – OH – 3630.64 – 10.00 PER MONTH - UP TO DATE
GREAT UNIVERSAL – ME – O/S 651.83 – PAYMENTS OF £30 PER MONTH – UP TO DATE
BROTHER – CAR LOAN – 37.19 PER MONTH – UP TO DATE



MISC



RBS OVERDRAFT - 4000.00
DAD – 3100.00
MUM – 500.00

G E MONEY SERVIVING LIMITED (SECURED LOAN) – 208.92
EGG CARD – 40.00 (15.9% APR)
EGG LOAN – 361.80 (7.7% APR) PAYABLE TILL DEC 2011
RBS PERSONAL LOAN – 61.39 (PAID OFF IN AUGUST THIS YEAR)
CAPITAL ONE CC – ME – O/S APPROX – 300.00 (17.9%) UP TO DATE



How much does the business roughly bring home a month? Are you covering your overheads? If not, I suggest that you seriously think about whether you want to continue with it, or perhaps do it on a part time basis – perhaps just selling online & working from home rather than from a rented premises (assuming that is what you are doing). You need two solid incomes & if one is not guaranteed – plus with all of your arrears – then I can’t see how you are supposed to manage!! Even to service your basic living costs you will need to up your income slightly.



It seems as though you have negotiated some payments with your creditors which is good, but there are still a few outstanding. Please please phone them & explain your situation – send them a copy of this SOA – even if it means that you are only paying a token payment of £1 to each creditor. If this is all you can afford, then this is all you can afford. They cant have money you don’t have but this doesn’t mean that you can ignore them in the hope they will go away (hell – I used to do this – we all have!!) as they will get angrier and angrier and be less inclined to help!!



To see example letters to write to creditors (and lots of other useful advice) go to:



http://www.kronos.moonfruit.com/



(hit the “Proposal” tab and you will see a link to the template)



http://payplan.com



http://www.citizensadvice.org.uk/



In terms of your business accounts – as others have mentioned, I am a bit concerned with the Inland Revenue Bills – you must call them immediately & speak to them about how you can repay them. I don’t have any experience of business related things so I do apologise!!



I am really sorry as I don’t feel as though I have been much help, but some of this stuff is beyond me.



I suggest that you make an urgent appointment with Citizens Advice or speak to Payplan (links above), but the longer this situation is left the worse it will get.



You have done really well though & made the first step, so keep up the good work & we’ll soon have something sorted for you.


BUSINESS DIRECT DEBITS

SHOP RENT – 368.33
MOTORLINE INSURANCE (VAN) – 52.14
UNITED UTILITIES – 20.88
NATIONAL INSURANCE – 10.50
CARDNET CHARGE – 25.57
VIRTUAL LEASE (EVERY 3 MONTHS) 84.60
MATSU – 30.00
DIRECT LINE (CAR INSURANCE) – 50.00

WAS ALSO 240.12 HP EACH MONTH ON VAN BUT DAD HAS PAID THIS OFF AS VAN FOR SALE – WILL BE PAYING HIM BACK FULLY WHEN VAN IS SOLD

ALL UP TODATE AT THE MOMENT!!!!

BUSINESS BILLS

CAR TAX – 90.75 DUE END OF THIS MONTH *******
ACCOUNTANT – JUNE 05 – 94.00 – OVERDUE
ACCOUNTANT – OCT 05 – 94.00 – OVERDUE
ACCOUNTANT – JAN 06 – 94.00 - OVERDUE
CARS DEBT RECOVERY – 93.71 - 47.00 OVERDUE (DUE BY 17/3/06) THE REST BY SAME TIME NEXT MONTH
BUSINESS RATES – O/S 538.00 OVERDUE FOR LAST YEAR – HAVE WRITTEN TO SEE IF THEY WILL SPREAD OVER THIS YEAR WITH NEW BILL
O2 (BUSINESS MOBILE ) – 60.45 – OVERDUE
BT – BUSINESS PHONE – 80.14 – OVERDUE
INLAND REVENUE – 05 JUL 05 – 120.85 OVERDUE
INLAND REVENUE – 05 AUG 05 – 96.68 OVERDUE
INLAND REVENUE – 05 SEP 05 – 96.68 OVERDUE
INLAND REVENUE – 05 OCT 05 – 120.85 OVERDUE
INLAND REVENUE – 05 NOV 05 – 96.68 OVERDUE
INLAND REVENUE – 05 JAN 06 – 64.21 OVERDUE
INLAND REVENUE – 05 FEB 06 – 96.68 – OVERDUE

PETROL & DIESEL – APPROX £40 PER MONTH

ms_london

Hand it to him & then leave him in peace for a few minutes to digest the information. He needs to know, at least then you will have his backing whatever the outsome. It affects him too. Perhaps if he was totally aware of the situation (regarding the business for example) he would be a bit more proactive & help you sort it out.

Perhaps take the kids out for a bit to let him think, but I am sure he will be fine. Post back and let us know what happens.

xxxxx

dottyanne

ms_london wrote:

Hand it to him & then leave him in peace for a few minutes to digest the information. He needs to know, at least then you will have his backing whatever the outsome. It affects him too. Perhaps if he was totally aware of the situation (regarding the business for example) he would be a bit more proactive & help you sort it out.

Perhaps take the kids out for a bit to let him think, but I am sure he will be fine. Post back and let us know what happens.

xxxxx

Hiya ms_london

Gonna have a chat with OH tonight - told him i need to speak to him regarding our finances.............scared sh**less though!!