5-8 September 2021

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5-8 September 2021

COVID-19 Advice Series from Retail Jeweller: What should independent business owners be focusing on during Lockdown 3.0

08 Jan 2021

As we enter a third national lockdown, expert business advisor Bobby Lane from Factotum shares his thoughts on what independent businesses should be focusing on during this time.

As Jewellery Retailers said goodbye to 2020 everyone was hoping for a better year ahead and a path towards recovery.

A trade deal was agreed, and vaccine administration had begun, so there were reasons to be cheerful. However, this positivity was short lived as the next national lockdown was announced by The Prime Minister on 4 January.
This announcement was accompanied by further support for retail and hospitality businesses required to close due to the new national restrictions by way of a grant.

  • £4,000 for businesses with a rateable value of £15,000 or under
  • £6,000 for businesses with a rateable value between £15,000 and £51,000
  • £9,000 for businesses with a rateable value of over £51,000

In addition, the government had previously extended the furlough scheme until the end of April 2021 along with the deadline for CBILS and Bounce Back Loans applications to March 2021.

Also, for businesses that already have a Bounce Back Loan but borrowed less than the full entitlement these can be topped up to the maximum amount before 31 March 2021.

Despite this support retailers cash reserves continue to diminish, and the ongoing uncertainty gives little indication of when life and business may return to any kind of normality.

What should independent retailers be doing during this lockdown to ensure they take advantage of what is available but also prepare for the recovery when it comes?

Make A Plan

The last year has demonstrated the crucial importance of forecasting. Independent retailers must put a cashflow together that shows what the business has in reserve and what it may need. This should be tested using different what if scenarios to demonstrate the worst case. This will provide business owners with the tools to make decisions on all areas including people, stock and premises.

It must include the repayments of any funding already taken such as Bounce Back Loans or any delayed tax payments such as VAT.
If a business is facing cashflow pressure, there is still time to look at the CBILS or Bounce Back Loans. However, these are loans and not grants so they will need to be paid back. For independents struggling to pay their taxes there is the possibility of arranging a time to pay arrangement by calling:

HMRC Payment Support Service
Telephone: 0300 200 3835
Monday to Friday, 8am to 4pm
For those that deferred VAT in 2020 instead of paying the full amount by the end of March 2021, businesses will be able to make up to 11 smaller monthly instalments, interest free with all instalments payable by the end of March 2022.

The online opt in process will be available in early 2021. If a business opts into the scheme, they can still have a time to pay arrangement for other HMRC debts and outstanding tax.

Spread the Word

Many independents have been forced to identify new ways to reach their customers whether online or through other sales channels. It is time to focus on how to deliver service promptly, efficiently and where customers want it.
Defining a point of difference and using every means possible to spread the word from social media to direct contact whilst trying to get customers to become brand ambassadors and share testimonials.

Is now the right time to sell?

The Government will have to pay for the measures that they have brought in to support businesses and there has been much discussion over the potential rises in Capital Gains Tax as one method.

This could mean as much as a 35% increase in the tax that a business owner could pay on selling. Independent retailers who may have been contemplating a sale or cashing in, should, in the short term, think seriously about this whilst the rates remain low.

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