What Will Liquidation Do For You
Acting at the right time can:
- Maximize the value of remaining assets
- Provide better outcomes for creditors and employees
- Protect directors from potential personal liability
- Allow for a more controlled and dignified business exit
Liquidation with SARS debt
When SARS debt accumulates to a point where it is too much to pay, especially because of interest and penalties, it is time to seriously consider liquidation as soon as possible.
Key Signs:
Key Signs:
– Receiving calls/emails/final demand notices from SARS
– Unable to negotiate or adhere with SARS for a payment arrangement or keep to payment arrangements with SARS
– SARS debt is growing faster than your ability to generate revenue
Personal and Emotional Indicators
When the business stress significantly impacts your personal life and health it is definitely time to consider the voluntary liquidation process to get rid of the problem and start over. It is of no use to persistently try and put out fires, not sleep or eat and nothing helps. We often get asked “ But what does liquidation mean” and the answer lies mostly just in that: liquidation gets rid of a problem company and the debt so that you can achieve financial freedom and focus on other aspects of your business instead of putting out fires all the time.
Legal Pressures Mount
When legal actions begin to interfere with day-to-day operations, it is time to liquidate.
Key Signs:
– Receiving multiple court summonses
– Creditors have started freezing business accounts
– Facing potential director disqualification due to company’s financial conduct
-No more credit but cash on delivery only
-Harassment by debt collectors
Turnaround Attempts Fail
After implementing a turnaround plan with no significant improvement, it is time to consider liquidation.
Key Signs:
– Cost-cutting measures do not improve profitability
– New product launches or pivots fail to gain traction within planned timeframe
– Unable to secure necessary funding or partnerships for turnaround
Market Position Becomes Unsustainable
When market share has declined steadily for 12-18 months with no signs of recovery, it is time to accept that there is a bigger problem and it may be time to rather liquidate.
Key Signs:
– Consistent loss of major clients to competitors
– Inability to adapt to significant industry changes within 6-12 months
– Products or services becoming obsolete with no viable alternatives in development
How Acting at the Right Time Can Help
Acting at the right time can:
– Maximize the value of remaining assets
– Provide better outcomes for creditors and employees
– Protect directors from potential personal liability
– Allow for a more controlled and dignified business exit
