How are small businesses going to be affected? Are we really headed for recession?
I recently spoke to turnaround expert Anthony Holmes, who had something interesting to say on the matter. However, if you were hoping for good news, you’re going to be disappointed.
Holmes says banks won’t want to refinance their loans and, therefore, many small businesses will fail because they’ve moved forward “on a feeling that it was going to be summer forever”.
He says big companies will squeeze the smaller companies for cash, but the smaller companies won’t have anyone to squeeze.
“If you’re a small business, you will have problems,” Holmes says. “If you’re large, you will have to begin to look at the arrangements of the debt that you’ve got.”
So what can you do?
Holmes reckons you need to “be honest and take external opinion about the risk to your business. Deal with the problem as soon as possible. Those who deal with it now, and properly, will actually come out of it in better shape.”
The only positive comment Holmes had to offer was that he isn’t convinced a recession is on its way. “I do think we’ve have financial distress and dysfunction. Will that find its way to a true recession? I’ll pass on that one.”
Related article: Peter Knight – How to thrive in tougher market conditions
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