Coronavirus

Is everyone planning for client losses?

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The government is in a hard place with trying to keep the economy going against implementing draconian measures for 1/2/3/4/5/6... months. 
 

Ultimately, the changes are that lots of small businesses are going to go out of business, either through them being ill and losing their clients (or their clients being ill); or through a general lose if trade. 

Are you planning for a loss in clients? 
What will you do when a clients asks to put a stop on their monthly payments?

What are your plans for your own resources?

 

I'm trying to get as much work in as possible, before clients get too ill to send it in. 
We're currently over staffed as it is, so have had to start thinking about who will be leaving us, as I can see only client losses and no new clients in this period. 

Replies (27)

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RLI
By lionofludesch
10th Mar 2020 09:39

Jeez - for a moment I thought you were on about clients dying off.

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Replying to lionofludesch:
Lone Wolf
By Lone_Wolf
10th Mar 2020 09:44

Well, there is that too.

Think of all the IHT returns :-/

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By ireallyshouldknowthisbut
10th Mar 2020 10:16

I've got one in travel who is staring down the barrel (no bookings for several weeks now) but i think most of ours will be OK in the medium term.

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By bernard michael
10th Mar 2020 11:01

Before you get too despondent look at the last downturn.
As businesses went under entrepreneurs/idiots started new ones and needed the brethren's help.
What goes round comes round - plus ca change

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By Truthsayer
10th Mar 2020 11:06

The pandemic will not last long, so I'm not anticipating it will have much long term effect. I can't think of a single client who will be affected very much.

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Replying to Truthsayer:
paddle steamer
By DJKL
10th Mar 2020 11:17

Its impact upon whether the world goes into recession will though, it is likely a significant contributory factor , together with with oil/trade wars and possibly a natural end to the bull run, to a possible world recession.

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Replying to Truthsayer:
paddle steamer
By DJKL
10th Mar 2020 11:19

Its impact upon whether the world goes into recession will though, it is likely a significant contributory factor , together with with oil/trade wars and possibly a natural end to the bull run, to a possible world recession.

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By claudialowe
10th Mar 2020 11:11

I am rather hoping that there will be something in the budget that gives me the excuse to email clients who won't have thought about the effect it will have on their businesses. I can then suggest that we have a phone call about steps they can be taking to safeguard themselves from a business perspective. I am trusting they are all old enough to know how to wash their hands!

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Replying to claudialowe:
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By Vaughan Blake1
10th Mar 2020 12:08

If anyone in business has not spent sometime thinking through the impact of this on their business, then tbh they should not be in business! I would have thought that most small business owners will be waking up at 4.00am in a cold sweat.

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Replying to Vaughan Blake1:
paddle steamer
By DJKL
10th Mar 2020 12:17

Agreed, they really ought to be, short of weather changing the spread there is a sort of inevitability about it all.

My gut feel is things could well accelerate say late next week/early following, I have for instance heard some HMG departments are busy setting up software etc for remote staff working and do fully expect we will, at some point before the Easter holidays, start shutting down schools/nurseries etc.

These more public sector risk assessment actions will then probably feed into and push the private sector, if no childcare a parent will need to be home and who is going to be asking vulnerable grandparents to cover and watch the kids (well maybe under 9s are okay)

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By Bob Loblaw
10th Mar 2020 11:13

I have a few elderly clients who are scared of the breeze and clinging onto life with their pinky fingers as is.

On the flipside, I've recently taken on a slew of budding entrepreneurs who are making a decent wedge selling hand sanitiser and loo roll.

World keeps turning.

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paddle steamer
By DJKL
10th Mar 2020 11:14

For us it is not clients but tenants.

I have reviewed our rent roll and identified those entities that look the most vulnerable (discretionary retail ,leisure and tourist retail/travel likely being most vulnerable), however worst case only 10-15% of our annual rents in these sectors, though we do have some in the care sector which could become impacted if they have to shut (nursery/charities/etc)

We are fortunate as we had already built up a cash war chest greater than two years bank repayments due to Brexit concerns re the wider economy so are fortunate that we ought to be able to weather the combined corona/oil/world recession (if that is what we are going to get, and it does look likely) better than most- after 2008 I did not want to again be extended with banks with no wriggle room. (Already received legal guidance re delay issues re construction contracts and tenant issues , I got one from Dentons yesterday, I suspect a slowdown in activity is now likely a given re property and that will feed into related trades/professions)

Now is certainly prepare your business time, I am just back from counting the boxes of hand towels and toilets rolls we have in store (we have a fair few offices/studios where we provide these as part of the rent) and will likely this afternoon order more hand towels. (Increased hand washing means we will use far more)

The next step is further ensuring that we have considered properly the safety of our tenants and associated staff who work within our offices, things like maybe increasing shared toilets cleaning frequencies, affixing notices in same etc; I will likely spent part of this afternoon also on this.

There are a lot of risk areas that need considered re protecting staff, for instance one risk area those in practice may not have considered is staff handling bags of client records; perhaps you all need to create a drop of area but your staff do not handle these until the following day.

There are likely a lot of other risk areas where a prudent employer needs to ensure he/she has acted reasonably , that means , imho, going far beyond HMG guidance and thinking what a reasonable employer, owing a legal duty of care re the safety of his/her staff, would do in the circumstances; office closures may, at the end of the day, turn out to be the safest route. (That and discussing with insurance brokers one's employee/public liability cover)

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By SXGuy
10th Mar 2020 11:16

As I said in another post. Won't affect me. Most clients self employed tradesmen, cabbies, landlords. All have to work I'll or not, can't see them being out of business any time soon.

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Replying to SXGuy:
paddle steamer
By DJKL
10th Mar 2020 11:27

Well, what happens when construction sites possibly close, tenants are not working and cannot pay landlord their rent and people are holing up at home so cabs are being used less?

We as landlords are not ignoring the risks and we are somewhat better funded than most in property industry, very few of whom carry liquidity. I would say there currently is likely a clear and present danger to nearly all economic activities

https://www.dentons.com/en/insights/articles/2020/march/9/covid-19-and-r...

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Replying to DJKL:
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By justsotax
10th Mar 2020 11:37

wonder whether BJ or cummings realise that....or indeed care....

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Replying to justsotax:
paddle steamer
By DJKL
10th Mar 2020 12:05

Not a lot they can now do- crash planning is too late; they have three constraints here- equipment (ventilators etc), staff and space, the last maybe can short term be sorted by using halls/hangers etc, the first two are a real issue (especially as all the world will be chasing down equipment right now).

Re the wider economy there is nothing they can do- the idea that a country like the UK can , in a globalised world, self determine its economic outcomes has always been a nonsense, at best they can tinker at the edges, but at the end of the day if the virus really takes hold then trying to get banks etc to play ball with say mortgage arrears (a few recent announcements re this) and encouraging employers to say pay absent parents if schools close (not sure which employers will be able to afford much beyond SMP if sales have hit a wall) is probably all they really can do- in effect rock and a hard place, try Italian Job and certain economic downside with no guarantees it works or take the current containment/slow spread strategy which actually could, if it does not work out well, have a greater economic cost.

Being cynical I doubt individuals matter to them that much except that a high body count makes re-election trickier if it gets pinned on a lack of NHS resources.

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Replying to justsotax:
RLI
By lionofludesch
10th Mar 2020 12:24

justsotax wrote:

wonder whether BJ or cummings realise that....or indeed care....

Why are you wondering?

Of course they don't care!

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Replying to DJKL:
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By SXGuy
10th Mar 2020 13:25

Wonder if hmrc will accept the excuse that clients SA is late due to Covid 19. Probably not.

My point was life has to carry on. Whether someone is working or not. Taxes still need filing.

The whole concept of closing down and staying home is pointless and stupid.

How long would you consider is long enough? 1 month? 3? 6? 12? At some point we will catch it and get over it.

All this is doing is hurting the economy, until I see evidence that this is worse than the flu death rates I will continue to believe that it's all media inflated panic.

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Replying to SXGuy:
paddle steamer
By DJKL
10th Mar 2020 14:06

Surely in at least this case we follow the advice of experts regarding the best approach. Of course even that appears to be fluid given paucity of consistent data, for instance there may currently be a slight change in expert stance on the view re precursor cold symptoms brewing as we speak , who knows. For lay individuals to naysay the guidance of experts is frankly akin to those posting on here who really need to consult an accountant.

The issue appears to be not flu death rates, if say 1% die who contract that might be no worse than flu, what is the issue is the percentage of the total population that likely contract Covid- 19 which is apparently miles higher than with the spread of more traditional flu.

Flu might only say kill say 1:100 but it is perfectly possible (or probable) that far more people will contract Covid-19 this year than would ever contract flu in one year, that is I understand the danger, infection rate rather than death rate.

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Replying to DJKL:
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By SWAccountant
10th Mar 2020 14:21

Fatality rate is much higher than Flu. 3.4% vs 0.1% (although admittedly this is mainly the elderly/vulnerable which bear a 15% fatality rate vs 0.2% for the rest of us).

This is also much more infectious than Flu, and results in a much higher % needing hospitalization even if they ultimately recover. Way more than we can cope with.

Death rates may increase as medical facilities can no longer provide treatment, or it may drop if (as I suspect) this is already much more widespread than we think and mostly harmless.

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Replying to SWAccountant:
paddle steamer
By DJKL
10th Mar 2020 15:04

I am currently taking all fatality rates announced/published with a pinch of salt, the measurement of virus incidence looks difficult (possibly under measured) and probably is not consistent country to country.

Ignoring the actual percentages, as possibly suspect, my point was more incidence of infection is likely higher which means if mortality rate are say the same as normal flu, re those who contract, then the death toll will be higher

I do follow your other points you make but to date do not trust any of the percentages being used re mortality as population definitions are likely flawed.
(My merit in my uni statistics course now coming in handy)

The swamping issue is certainly one that I think is front and centre of HMG current response

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Replying to DJKL:
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By SWAccountant
10th Mar 2020 16:30

Quite. When it was just China, I didn't believe them - their actions seemed to outweigh what the % was saying, suggesting a bigger problem they wouldn't admit to.

Now its effectively Global though, among recorded cases the averages have remained consistent.

I do think its far more widespread than we know. I was ill mid-Jan with something that exactly matches the symptoms (even though it hadn't officially escaped China at that point) and I won't be at all surprised to learn its been circulating for a lot longer than we thought.

Unless you have reason to seek medical attention, until now you simply wouldn't report something that for most will present as a flu.

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Replying to SWAccountant:
paddle steamer
By DJKL
10th Mar 2020 16:45

My son came back from USA mid December with the mother of all flu which he kindly passed to me so that I went down with it on the 26th December, I stayed very ill right through until 3rd January ( my chest latterly was agony with coughing and I was a few days not eating but just sleeping/taking fluids) and was just getting over it by the 6th, however this was all the cold/nose/throat/chest things plus high temperature and sweats, pretty unpleasant but I am not convinced it was Covid 19.

It is true though, if you get flu you generally do not see a doctor and there is no record really of your ever having succumbed.

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Replying to Ruddles:
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By MadHatter
11th Mar 2020 14:33

You have previously stated your intention to stalk an individual.
You describe yourself as a "troll hunter".
You have recently made a death threat, and detailed how you will carry it out.

You have made these threats against several members, all of course alleged to be the same member in your demonstrably deluded mind.

You recently made a grossly offensive comment to someone whos' wife tragically passed away only 3 months ago.

As predicted I then joined this site, made a couple of posts, and was immediately attacked by you.

I suggest you now read the following. Aweb will certainly be reminded of their legal responsibilities in aiding and abetting you by allowing you to remain on this site.

Protection of Freedoms Act 2012

111Offences in relation to stalking
(1)After section 2 of the Protection from Harassment Act 1997 (offence of harassment) insert—
“2AOffence of stalking
(1)A person is guilty of an offence if—
(a)the person pursues a course of conduct in breach of section 1(1), and
(b)the course of conduct amounts to stalking.
(2)For the purposes of subsection (1)(b) (and section 4A(1)(a)) a person’s course of conduct amounts to stalking of another person if—
(a)it amounts to harassment of that person,
(b)the acts or omissions involved are ones associated with stalking, and
(c)the person whose course of conduct it is knows or ought to know that the course of conduct amounts to harassment of the other person.
(3)The following are examples of acts or omissions which, in particular circumstances, are ones associated with stalking—
(a)following a person,
(b)contacting, or attempting to contact, a person by any means,
(c)publishing any statement or other material—
(i)relating or purporting to relate to a person, or
(ii)purporting to originate from a person,
(d)monitoring the use by a person of the internet, email or any other form of electronic communication,
(e)loitering in any place (whether public or private),
(f)interfering with any property in the possession of a person,
(g)watching or spying on a person.
(4)A person guilty of an offence under this section is liable on summary conviction to imprisonment for a term not exceeding 51 weeks, or a fine not exceeding level 5 on the standard scale, or both.
(5)In relation to an offence committed before the commencement of section 281(5) of the Criminal Justice Act 2003, the reference in subsection (4) to 51 weeks is to be read as a reference to six months.
(6)This section is without prejudice to the generality of section 2.”
(2)After section 4 of that Act (putting people in fear of violence) insert—

“4AStalking involving fear of violence or serious alarm or distress
(1)A person (“A”) whose course of conduct—
(a)amounts to stalking, and
(b)either—
(i)causes another (“B”) to fear, on at least two occasions, that violence will be used against B, or
(ii)causes B serious alarm or distress which has a substantial adverse effect on B’s usual day-to-day activities,
is guilty of an offence if A knows or ought to know that A’s course of conduct will cause B so to fear on each of those occasions or (as the case may be) will cause such alarm or distress.
(2)For the purposes of this section A ought to know that A’s course of conduct will cause B to fear that violence will be used against B on any occasion if a reasonable person in possession of the same information would think the course of conduct would cause B so to fear on that occasion.
(3)For the purposes of this section A ought to know that A’s course of conduct will cause B serious alarm or distress which has a substantial adverse effect on B’s usual day-to-day activities if a reasonable person in possession of the same information would think the course of conduct would cause B such alarm or distress.
(5)A person guilty of an offence under this section is liable—
(a)on conviction on indictment, to imprisonment for a term not exceeding five years, or a fine, or both, or
(b)on summary conviction, to imprisonment for a term not exceeding twelve months, or a fine not exceeding the statutory maximum, or both.
(6)In relation to an offence committed before the commencement of section 154(1) of the Criminal Justice Act 2003, the reference in subsection (5)(b) to twelve months is to be read as a reference to six months.
(7)If on the trial on indictment of a person charged with an offence under this section the jury find the person not guilty of the offence charged, they may find the person guilty of an offence under section 2 or 2A.

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Replying to MadHatter:
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By SXGuy
11th Mar 2020 14:54

I don't see how I'd put the elderly at more risk. If you had a cold or the flu you would avoid contact with someone who would suffer more from it. This is no different.

The isolate rhetoric is simply used to delay the spread until the summer months when the NHS will cope better. They know full well at some point nearly everyone will contract it. And most will not even know.

I have heard a few people who have said they called NHS help line as they were worried they might have it and was told to fill out a question are online. No physical diagnosis, answers could be taken either way. So if they are including these people in statistics who knows what they real numbers are.

I have just come out of a 4 week flu like illness. First week shivers and fever, second week cough and ache, 3rd week tight chest and hard to breathe. Dr confirmed I'd developed bronchitis, but had I rang NHS helpline by the 2nd week I could have easily convinced myself I had covid 19. I may well have. Who knows.

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Lone Wolf
By Lone_Wolf
10th Mar 2020 14:33

I'm not sure whether being a cynic is helpful or not in this situation.

The sensible part of my brain, as little as there is, says listen to the experts advice on this. they know what they are talking about.

My inner cynic then pipes in with two arguments:

1) It is in these experts interests to exaggerate this situation, create panic among governments and encourage them to release large amounts of funding in a panic. Big bonuses for all those involved in fighting the virus.

2) Governments around the world are taking actions that could badly damage their economies, which doesn't sit naturally with my impression that they're all only interested in filling their pockets. Could be they're more afraid of losing votes through high mortality rates, but I'm not sure.

When it comes down to it, it seems clear this is a serious situation - both in terms of public health and the economic impact.

Those treating it not so, and trying to liken it to the flu ... perhaps their denial comes from fear of the unknown.

Thanks (1)
RLI
By lionofludesch
10th Mar 2020 23:11

Meanwhile, one newspaper reports that the UK will be blanketed with snow this week.

Well, we'll see.

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