Running In the Red

Whether to continue running in the red will depend on the structure of a business.

As long as a sole trader or small partnership has sufficient personal assets you can continue for as long as those assets will cover any liabilities that you incur.

Remember that for a sole trader or a partnership you do not have limited liability so any debts that are incurred can be recovered by creditors through the sale of your personal assets.

If you are running under this type of structure and you have been running at a loss for a number of years then it is suggested that a visit to a financial planner is necessary. You will also need to look at ways to turn your business around – conduct new market research into what the customer wants or look at new products or services that you can introduce.

© 2005 StartRunGrow




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