I’d built this business over twenty years. I couldn’t tell anyone how bad it had got.
I’d built this business over twenty years. My name was on the door. People in this town trusted us with their cars, recommended us to their neighbours. From the outside, everything looked fine. Inside, I knew we were in serious trouble — and I couldn’t tell anyone.
I’d been using my personal credit cards to keep the business going. What started as bridging the odd gap had become something I relied on. The cards were maxed out, the minimum payments were taking money the business couldn’t spare, and the interest kept building. That’s where the cash flow was going. And because the cash wasn’t there, VAT was going unpaid, suppliers were waiting longer than they should. I kept thinking it was a rough patch. I kept thinking I’d turn it around.
Then we looked at the stock and purchasing records properly, and I had to face something I hadn’t wanted to see. Someone was stealing from us. Someone I’d trusted. The business wasn’t just losing money to the banks — it was being stolen from the inside. That was hard. That was really hard.
By the time my accountant referred me to Lightside, we were close to the edge. I knew what that meant. I wasn’t prepared to go down that road — and I wasn’t going to liquidate either. I had staff who depended on us. I had children I wanted to hand something to. And I genuinely believed the business was worth saving. It had a good name. It had good customers. The problem wasn’t the business — the problem was the debt that was suffocating it.
The Outcome in brief
Advised by Priti Shah · Referred by Andrew Rhodes, Partner — Sobell Rhodes LLP · www.sobellrhodes.co.uk
My credit was already maxed out. I didn’t need my credit rating. What I needed was to be able to hold my head up in this community, carry on running the business, look after my staff, and have something to pass on to my children. That’s what we got.
Is your business under pressure from personal debt?
If personal debt is affecting your company’s cash flow, the two problems are connected — and they can be addressed together. There’s no charge for the first conversation.
The work behind the outcome
The family business was saved. It continues to trade, has expanded to include more family members, and George is working part-time, easing towards retirement — leaving behind a business with a future his children can take on.
We were introduced to George by Andrew Rhodes, Partner at Sobell Rhodes LLP (www.sobellrhodes.co.uk). George’s garage and body shop operated as a limited company — which meant that his personal debts and the company’s debts were legally separate, but in practice each was damaging the other. The first task was to understand what the business was actually worth, underneath the debt and the damage.
We analysed the company’s trading figures and remodelled them on two adjusted bases: first, removing the credit card repayments and interest that had been draining cash from the business every month — these were George’s personal debts, but their repayment was coming out of the business; second, restating the true cost of stock purchases to reflect what those figures should have looked like, had the theft not been taking place. On both adjusted bases, the business returned a viable trading position. This was significant — at the point George came to us, the company was close to trading insolvently, a position that carries serious legal consequences for a director. The modelling showed that was not the underlying reality. The problem was not the garage, the reputation, or the customer base — it was the cash flow, and the cash flow had two identifiable causes that could both be addressed.
With that analysis in hand, George faced a genuine choice. Liquidation of the company was considered seriously. The overall financial cost to George would have been lower, and he could have restarted in business afterwards. But George was not prepared to take that route — not with a business that had traded for twenty years, not with employees who depended on it, and not when the restructure was demonstrably viable. He chose the harder path personally, knowing it would impact his own credit position, because it was the right outcome for the business, his staff, and his family.
The work then proceeded on two fronts. George and his manager took the steps needed within the business: identifying the source of the stock losses, removing the rogue employee, and putting controls in place so the theft could not recur. On the financial side, Lightside negotiated an informal creditor arrangement with George’s personal creditors. Interest and charges were frozen and monthly repayments were reduced to a sustainable level — this is not a formal insolvency procedure, it requires no court involvement, but it stopped the credit card drain that had been starving the business of cash. In parallel, we agreed a Time to Pay arrangement with HMRC for the overdue VAT. With a viable business and a credible repayment proposal, HMRC agreed. Quarterly returns began to be submitted and paid on time, and the business returned to full compliance.
George’s personal credit rating was affected by the creditor arrangement. He accepted this without reservation. His credit was already exhausted. What he needed was a business that would not just survive, but could thrive — and a way to hold his head up in the community he had served for twenty years.
The family business was saved. It continues to trade, has expanded to include more family members, and George is working part-time, easing towards retirement — leaving behind a business with a future his children can take on.