When ordinary operating costs cannot be funded, decide what can responsibly continue and what an orderly change would require. Waiting without a plan can increase the shortfall.
Corporate Recovery Partners
01 / 06
There is too little cash for the operating week
A fabrication workshop has enough cash for only part of the coming week. Jobs remain unfinished and the owner is using each receipt to pay whichever cost is most urgent. Keeping the doors open feels essential, but no one has calculated whether finishing the work will produce enough money to cover the additional expense.
List wages, materials, premises, insurance, finance and other unavoidable payments. Match them with realistic receipts and the costs required to earn those receipts. Separate work that is profitable from work that merely adds turnover.
Do not count money tied up in disputed invoices as immediately available. Show the position if the main receipt is delayed. The forecast should expose the decision, not be adjusted until continued trading appears affordable.
List customer deposits, incomplete jobs, employee entitlements and property belonging to others. Ask advisers what must happen if activity is reduced or stopped. Check contracts before cancelling work or returning goods.
Preserve access to records and make a safe site plan. These practical tasks matter whether the outcome is a temporary change, a negotiated exit or a formal insolvency process.
ASIC advises seeking qualified help when a company is in financial difficulty. Take the current cash picture to an insolvency practitioner and obtain legal advice on urgent notices or director issues.
Ask what can lawfully continue and what commitments should be controlled. Do not rely on another customer deposit to fund earlier work without a credible ability to deliver the new promise.
Nominate who will speak to staff, customers and suppliers. Use the actual plan and avoid guarantees about payment or completion that cannot be supported. Keep records of agreements and changes.
If a decision is deferred, specify the event and date that justify the delay, such as confirmed funding. An open-ended hope that trade will improve can leave everyone facing a larger problem.
