If you want to go through the whole process of winding down your business and closing it for good, you need time and a plan. It can take months to complete this process and you need the plan that will protect your assets as best you can. You not only have your personal assets to consider, but your credit and your business reputation. It’s important to take time with this process and get it right. The last thing that you want to do is let the last pieces of your business go and fall apart – you’ll be haunted by headaches about it for years.
This process takes time and a proper process for shutting down involves learning things like the insolvent trading definition. This ensures that you are making no mistakes after you provide people with notice that you plan to shut down. Who you tell about your plans to close will affect your chance to make the most of the process, which is why we’ve created a handy list for you to follow.
- Start by ensuring that your finance team is collecting any outstanding debts. Do this before you tell customers that you are closing down your business.
- Sell off all of your inventory with a sale or two to indicate you are going out of business. This can earn some last minute cash for your business.
- Talk to your creditors. You have a long list of service providers, lenders and suppliers that you need to talk to about the plan to shut the business and when you do this the right way, you can ensure that you limit the time that debts can be called in.
- Let your customers know that you are going to be closing and then deal with any contractual obligations that may occur. Always repay any deposits or payments for any goods that were not fulfilled.
- Get your commercial premises lease terminated and notice given.
- Notify and pay your staff. You want to give your employees as much notice as possible here.
- Liquidate the assets of your business one by one and pay off your debts as much as you can.
- Cancel all your business subscriptions, cards and borrowing streams.
- If there are any laws surrounding your bulk selling, you need to ensure that you adhere to these. Your creditors need to be notified a certain number of days before you close your business once and for all. There are some laws that state you must notify the close of business in the local newspapers.
- Any bank accounts and credit card accounts should be closed down as soon as possible from the day of the closure.
- Cancelling all of your state licenses and permits is a must. You need to make sure that you no longer have a business license in your name, and you need to file your final tax returns.
This is not a fast process for your business and you need to give it time to take effect.