Will Bankruptcy Damage my new Business?

GRiFF

Right now I'm basically hitting everything as hard as I can to get work into the business, looks like I am going to need a miracle to transform this in the next month.

The only reason why I've not been doing this already is that my partner gave birth and I found myself unable to work from home while she and the baby were in the house - not at all practical for visiting singers and musicians - and I was needed to help her out.
During this time I was desperately trying to get the cabin prepped which also took a lot of work.

The cabin is now ready for business, de-bugged and primed to do well but I'm now very concerned that I will simply run out of time.
I had been wrapping up the old business because it was not working anymore.

My plan at the moment would be to try and at least create enough of a revenue stream that I might be able to apply for an IVA although even this seems no guarantee of securing the goods I need.

I think a real fight may be about to begin.

September_2012

Could you sale some non essential kit to raise money or get a part time job to keep money coming in while business builds up ?

My advice is stay on top of top of your debt repayments, if you fall behind the banks are on you like glue and it is very difficult to catch up on a limited income.

GRiFF

I would do this but the problem is that if I worked we'd be having to look at full time child care - 2 children £80.00 a day - being as I am not particularly qualified to do jobs other than unskilled or what I'm trained to do - music production I'm likely to earn less than the cost of childcare - my job right now or contribution to the house is worth in the region of £300 - £400 a week, plus there is in theory flexibility.

My best hope of getting a workable balance is to try and book the studio 3/4 days a week and still do some child care.

In respect of earlier questions, I realize in the eyes of some liquidators I deserve absolutely no mercy, but it does strike me as particular harsh if they lifted absolutely everything I owned in respect of music equipment - I mean I am a musician and in some respects it'd be like re-possessing a wheelchair from someone disabled...ok, not quite that bad! but you know what I mean - I am still allowed to be a musician post BR

Maybe I'm trying to be hopeful here but would they really seize absolutely everything?

As reckless as what I have done might seem surely its more beneficial that I am able to make a living post BR rather than be forced onto benefits?

Or does that not figure?

September_2012

My friend gets some kind of benefit that pays for his kids child care. I dont know how people deal with child care but many seem to manage.

It isn't about mercy or punishment. It's the Official Receivers job to convert your assets into money to pay back your creditors.

You contribute £300 -£400 a week into your rented house and your wife works full time, is it possible you could budget your household expenses better ?

GRiFF

I live in Surrey and its very expensive - everything is expensive here - living costs, particularly rent and childcare.
£80 a day is pretty good for childcare - even as a parent I do not know how people are supposed to cope with having children and work, sure people do manage but then they also have family close to hand, family for both us is far away.

My partner earns decent money but our affairs are separate and my partner has plenty of costs of her own to worry about.

I don't think this is really about money management so much, its to do with having been caught out by a prolonged recession, having to go VAT registered (very difficult to make work) and deal with sudden hike in selling prices, petrol, shipping costs etc. Prior to this my business went from £75,000 a year turn over to £220,000 in 3 years - then it dropped to £40,000 in 2010 - that was a shocker, took me a long time, too long to admit that the good times were gone.
By the time I did, my capital was used and I was looking up old clients for any work they could toss my way.

I don't think that I would qualify for benefits and any I would get I can't see going that far, although I'm going to look at this now you mention it.

CKhalvashi

GRiFF wrote: »

New business is going to take time to build up, but I have done a number of sessions and I have a couple of regulars.
Its probably worth about £500 a month at the present time.

And what are you charging/where are you working?

I think that the studios were renting in our new office for about £2k/month before we bought it, and I know that although high, you'll find nothing less than about £1000/month anywhere round here.

Is there anything for rent studio-wise with adjoining management company and preferably record label? I know of one at £1150/month relatively near to us, however I also know the gentleman that owns it, and most of the producers do a lot (and I mean a lot) of work for the (legally separate) label.

We've gone down the alternative route of owning the studios, then employing staff directly under the same entity, so I don't know the exact logistics, however at £200 a day, 25% bookings sees you paid up for the month and anything else is profit. We pay £210/day basic (through PAYE, no expenses) and the other company I mentioned pays £300/day, but you have rent to consider.

Either way, with regular work, runs about the same for you as a producer, and as such, we have staff regularly flitting between companies on our production side. I haven't told you this, but it's about £60k/year.

Where in the country are you, and I may be able to pass a couple of contacts your way.

I'm wondering if its going to be at all possible to do an IVA - if I lost the studio now I would be completely and utterly devastated.

That is a good avenue to explore, however without knowing all circumstances, we're unable to advise.

CK

ILW

You have 3 grands worth of guitars laying around. Sell them. Any musicians wishing to use your services will have their own instruments.

GRiFF

@CKHalvashi - I ran a studio in Shoreditch, the rates are killer and the industry is extremely competitive its hard getting paid at all, I didnt really mean to get back into it but it came to me when some clients asked if I might still do some work for them. I'm actually in a far better situation today costs wise, and work out of a converted AV cabin. Its actually one of the best environments yet for recording and mixing I've found.
I'm in Surrey these days but with strong connections to London, if you know of anything or could use me, be great to get some leads.

@LK - My guitars don't lay about they are used by me when producing for clients. There are lots of different kinds of producers, I'm a musician producer, I write for solo artists and craft backing tracks for people who might not be able to play an instrument.